Human Capital and Economic Development in India

The theoretical models of economic growth have underscored the role of human capital. The empirical analysis of growth for a broad group of countries shows that the school attainment has positive effect on growth. Many studies have found that a region’s growth is influenced by the initial level of human capital. Glaeser et al. (1995) find that human capital level in 1960 influences growth of the cities betIen 1960 and 1990. Similarly, Simon et al. (2002) found that cities that have higher level of human capital initially grow faster in the long run. The regional differences in level of human capital also explain geographic differences in firm formation rates with regions endoId with higher level of human capital having higher firm formation rates (Acs, 2004). This paper explores the role of human capital in India’s economic development.