What is the role of health in human capital formation?

Solution:

Human capital refers to the stock of skill and productive knowledge embodied in a population. This skill and productive knowledge is provided with the help of proper education and training. However, the benefits of education alone do not lead to the creation of human capital. A human population which is educated but unhealthy cannot realise its potential. An unhealthy population is a liability, and not an asset. Hence, health is an indispensable basis for realising one’s well being.