How does expenditure on migration act as a source of human capital formation

Question How does Expenditure on Migration act as a source of human capital formation?
Chapter Human Capital Formation
Class  Class 12
Subject Economics (Indian Economic Development)
Category Indian Economic Development Class 12 Sandeep Garg Solutions




Question – How does “Expenditure on Migration” act as a source of human capital formation?

Answer –

People migrate from one place to another in search of jobs that fetch them higher salaries as compared to their native incomes.

  • Unemployed people from rural areas migrate to urban areas in search of job (leading to utilization of inactive skill) and technical qualified persons like doctors, engineers etc. Migrate to other countries for higher salaries (leading to better utilization of skill).
  • Migration involves cost of transportation and cost of living in the migrated place, but increased earning at the new place outweighs the cost of migration.
  • Thus, migration is a source of human capital formation as it facilitates utilization of inactive skill and fuller utilization of skills.




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