Human Capital is the talents and capabilities that individuals contribute to the process of production. Human capital also refers to the sum total of skills and knowledge embodied in the ability to perform labor so as to produce economic value.
Companies, governments and individuals can invest in this human capital just as they can invest in technology and buildings or in finances.
According to Smith, human capital is skills, dexterity and judgment. A country's ability to learn from the leader is a function of its stock of "human capital".
Human capital can be acquired through formal schooling and on-the-job training. There is a complex relationship between the division of labor and human capital.
The human capital in an organization consists of the workers in an organization. There are a variety of measures by which human capital might be measured.
Intertwined with the human capital would seem to be another kind of capital. We might imagine a widget salesman in Pittsburgh who does a wonderful business, but fails to sell widgets in Cleveland. We might further imagine that over the years in Pittsburgh, the salesman developed relationships with clients that allowed for high sales. Moving to Cleveland, the salesman now had to complete with another widget salesman who had extensive relationships with his or her clients. People continued, in a reasonably competitive market to work with the person they knew and trusted. These relationships of trust might represent social capital squandered when the salesman left Pittsburgh, and an example of the competition between social and human capital in Cleveland.
"social capital" is an analogous term to "human capital" which was itself created by analogy to the term "physical capital." - Michael B. Spring.