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Chapter: 11th 12th std standard Indian Economy Economic status Higher secondary school College

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HRD and Economic Development

There is a close relationship between the indicators of HRD and indicators of economic development. The level of economic development can be studied by making use of the following indicators.

HRD and Economic Development

 

There is a close relationship between the indicators of HRD and indicators of economic development.

 

The level of economic development can be studied by making use of the following indicators.

 

Gross National Product (GNP) per capita in United States dollars ;

 

percentage of the active population engaged in agricultural occupation ;

 

public expenditures on education as a percentage of national income ; and

 

the percentage of the total population in the age group five to fourteen inclusive.

 

The findings of an important study by Harbison and Myers reveal

 

There is a very high positive correlation between the composite index of HRD and G.N.P. per capita in U.S. dollars; there is a high negative correlation between the composite index and the percentage of the active population engaged in agriculture

 

There are also high correlations between the adjusted second level enrolment ratio and GNP and percentage engaged in agriculture.

 

Correlations between the first level enrolment ratio and GNP and percentage in agriculture are lower than the correlations of either the composite index or the second level enrolment ratio with GNP and percentage in agriculture.

 

This shows that an index based on higher levels of education correlates more significantly with measures of economic development than one based on the lowest level of education.

 

While evolving strategies for HRD, the government has to make some basic choices.

 

It has to decide in formal education whether the emphasis should be on quantity or quality.

 

In secondary and higher education, it has to decide whether priority should be given to science and technology or law, arts and humanities ;

 

It has to decide in skill development whether the reliance should be placed on pre - employment formal training or in-service training ;

 

It has to decide whether incentives should be provided by manipulation of wages and salaries or should be left to market prices; and

 

It has to consider the needs and desires of the individual and needs of the State.

 

The choice between quantity and quality in educational development can take many forms. Some countries have to choose between education for all or high quality secondary and university education for a smaller number of potential leaders. There is also choice between educating fewer students with better qualified teachers and large numbers with unqualified teachers. In general, political and social pressures lead to emphasis on quantity whereas rapid economic growth requires high - level manpower. And there should be proper balance in

the development of education in science and technology and law, arts and humanities in secondary and higher education.

 

The theories of human resource development, in a general way, refer to educational planning. They can be divided into three categories (1) manpower approach (2) social demand approach and

rate of return approach.

 

Manpower Approach: The manpower approach to educational planning assumes that manpower with different levels and types of education is essential to attain a certain target growth rate of GNP. Then, the target is divided into different sectoral contributions to GNP. In a given year, the GNP is divided into different sectors and manpower structure in each of the sectors is analysed. Then the needed manpower with different levels and types of education is estimated. Death, retirement and migration are taken into account to estimate the necessary manpower. From the additional manpower requirements, enrolment figures are worked out. But the post - manpower forecasts proved that the estimates are far away from actual requirements. Moreover, this approach to educational planning does not say anything about the method of financing education.

 

Social Demand Approach: Social demand approach for education can be studied by making use of the social rate of return analysis.

 

Rate of Return Approach: If we assume education as investment, then we may look at it as individual investment and social investment. Under conditions of perfect competition, individual investment would be undertaken if the internal rate was greater than the market rate of interest. But today education and health are largely in the public sector. The social investment criterion is that resources are to be allocated to levels of education and years of schooling so as to equalize the marginal 'social' rate of return on educational investment (Mark Blaug). It may be noted that only pecuniary (monetary) values are taken into account while calculating the social rate of return. But the economic case for state education is generally made on the ground that external or indirect benefits of education exceed the direct personal benefits to those who are educated. But non -pecuniary returns to education and externalities are usually left out in the estimates of social rate of return. This is a limitation of this approach.

HRD and Economic Development

 

There is a close relationship between the indicators of HRD and indicators of economic development.

 

The level of economic development can be studied by making use of the following indicators.

 

Gross National Product (GNP) per capita in United States dollars ;

 

percentage of the active population engaged in agricultural occupation ;

 

public expenditures on education as a percentage of national income ; and

 

the percentage of the total population in the age group five to fourteen inclusive.

 

The findings of an important study by Harbison and Myers reveal

 

There is a very high positive correlation between the composite index of HRD and G.N.P. per capita in U.S. dollars; there is a high negative correlation between the composite index and the percentage of the active population engaged in agriculture

 

There are also high correlations between the adjusted second level enrolment ratio and GNP and percentage engaged in agriculture.

 

Correlations between the first level enrolment ratio and GNP and percentage in agriculture are lower than the correlations of either the composite index or the second level enrolment ratio with GNP and percentage in agriculture.

 

This shows that an index based on higher levels of education correlates more significantly with measures of economic development than one based on the lowest level of education.

 

While evolving strategies for HRD, the government has to make some basic choices.

 

It has to decide in formal education whether the emphasis should be on quantity or quality.

 

In secondary and higher education, it has to decide whether priority should be given to science and technology or law, arts and humanities ;

 

It has to decide in skill development whether the reliance should be placed on pre - employment formal training or in-service training ;

 

It has to decide whether incentives should be provided by manipulation of wages and salaries or should be left to market prices; and

 

It has to consider the needs and desires of the individual and needs of the State.

 

The choice between quantity and quality in educational development can take many forms. Some countries have to choose between education for all or high quality secondary and university education for a smaller number of potential leaders. There is also choice between educating fewer students with better qualified teachers and large numbers with unqualified teachers. In general, political and social pressures lead to emphasis on quantity whereas rapid economic growth requires high - level manpower. And there should be proper balance in

the development of education in science and technology and law, arts and humanities in secondary and higher education.

 

The theories of human resource development, in a general way, refer to educational planning. They can be divided into three categories (1) manpower approach (2) social demand approach and

rate of return approach.

. Manpower Approach: The manpower approach to educational planning assumes that manpower with different levels and types of education is essential to attain a certain target growth rate of GNP. Then, the target is divided into different sectoral contributions to GNP. In a given year, the GNP is divided into different sectors and manpower structure in each of the sectors is analysed. Then the needed manpower with different levels and types of education is estimated. Death, retirement and migration are taken into account to estimate the necessary manpower. From the additional manpower requirements, enrolment figures are worked out. But the post - manpower forecasts proved that the estimates are far away from actual requirements. Moreover, this approach to educational planning does not say anything about the method of financing education.

 

Social Demand Approach: Social demand approach for education can be studied by making use of the social rate of return analysis.

 

Rate of Return Approach: If we assume education as investment, then we may look at it as individual investment and social investment. Under conditions of perfect competition, individual investment would be undertaken if the internal rate was greater than the market rate of interest. But today education and health are largely in the public sector. The social investment criterion is that resources are to be allocated to levels of education and years of schooling so as to equalize the marginal 'social' rate of return on educational investment (Mark Blaug). It may be noted that only pecuniary (monetary) values are taken into account while calculating the social rate of return. But the economic case for state education is generally made on the ground that external or indirect benefits of education exceed the direct personal benefits to those who are educated. But non -pecuniary returns to education and externalities are usually left out in the estimates of social rate of return. This is a limitation of this approach.

 

Study Material, Lecturing Notes, Assignment, Reference, Wiki description explanation, brief detail


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