The human capital hypothesis states that:

Question

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The human capital hypothesis argues that the investment in education, training, and other forms of human capital is the key to increases in productivity and earnings. It suggests that the fewer skills people have and the lower priority they place on employment compared to other activities, the lower their income will be. This means that people with higher levels of education and training are more likely to have higher-paying jobs, and those who prioritize work over other activities will generally have higher incomes as well.

The Human Capital Hypothesis States That