Environmental Assessment
Human resource refers to physical, human and mental effort that is directed towards the production of goods and services; it comprises unskilled, semi-skilled and skilled labor force. On the other hand, natural resources comprise of minerals, climate, soil, oil, geothermal power and other gifts of nature. Some economists have considered human resource to be more important in determination of a country’s future than natural resources for the reasons outlined herein.
Human resource is mobile geographically. People can move from one region to another. Human resource is also mobile occupationally to some extent, especially unskilled labor. It is therefore possible to expand output when human resource is at full employment by importing human resource. In contrast, natural resources are immobile both geographically and occupationally hence it is impossible to increase output by increasing natural resources once it is fully employed.
Human resource contains enormous significance and plays an imperative role in the development of a country. Human resource is an active factor of production because it is necessity for proper utilization of a country’s natural resources while natural resources are a passive ingredient. Human resource can also be used repeatedly in production while natural resources are subject to depletion.
Supply-side economists, led by Adam Smith, argue that the wealth of a nation is determined by the productivity of labor. They view capital as fixed; it is therefore the level of technology and the productivity of labor that determines the level of output. The quality of human resource can be improved through education and training, which will in effect raise the level of output. However, the quality of natural resources is given and cannot be altered.
It is evident that human resource is more instrumental in bringing economic development than natural resources. It is therefore important for any country to invest in developing human resource through education and training to increase the stock of human capital.
References
Maier, M. H., & Nelson, J. A. (2007). Introducing Economics : a critical guide (illustrated ed.). New York: M.E. Sharpe.
Walstad, W. B. (1994). An international Perspective on Economics (illustrated ed.). New York: Springer.
Watts, M., Mccorkle, S., & Meszaros, T. B. High School Economics (2 ed.). Washington: National Council on Economics.
