Distinguish between Physical Capital and Human Capital.

Question

Accepted Answer

Distinguish between Physical Capital and Human Capital:

| Basis | Physical Capital | Human Capital |
|-------|------------------|---------------|
| Tangibility | Tangible, can be seen and touched | Intangible, embodied in individuals |
| Separability | Can be separated from owner | Cannot be separated from owner |
| Mobility | Highly mobile between countries | Less mobile due to nationality and culture |
| Depreciation | Depreciates with use and time | Can be maintained through continuous investment |
| Ownership | Owned by individuals or firms | Owned by individuals |
| Formation | Mainly economic and technical process | Partly social and partly conscious decision |
| Benefits | Creates private benefits only | Creates both private and social benefits |
| Examples | Machinery, buildings, equipment | Education, health, skills, experience |