HUMAN CAPITAL AND INNOVATIVE FACTORS OF ITS DEVELOPMENT

In the modern economy, the popularity of the theory of human capital is growing. Initially, the majority of theorists of human capital adhered to the most narrow interpretation of this concept: they referred to it only knowledge, skills and competences acquired in the formal education system and directly used to generate income in the field of paid employment. G. Becker's formulation is widely known: human capital is formed by investing in a person, among which are training, on-the-job training, expenditures on health care, migration and the search for information on prices and incomes. Today, broad interpretations of human capital are more popular: it includes a wide range of personal qualities, ideological attitudes, value orientations that can have an indirect effect on the results of productive activities. Some authors include in the human capital not only personal properties of a person, but also social capital, embodied in relations between people. It is significant that G. Becker did not confuse the concept of social capital with human capital. The separation of human and social capital is enshrined in the methodology of the World Bank, in which they are classified as separate elements of world wealth, embodied in total human resources.

The methodology of human capital formation requires a clear, well-defined understanding of the content, the internal structure in the relationship and interdependence.

If we proceed from this approach, the internal logic of its structure is determined by the following elements:

- capital of health and healthy lifestyle;

- education capital (general and special knowledge);

- capital training in the workplace (qualifications, skills, production experience);

- scientific capital (inventions, innovations, research);

- capital of culture (education, self-education, self-development);

- possession of economically significant information (awareness of prices and income);

- migration capital (employee mobility);

- the motivation of economic activity.

 

For the production of goods or services in order to meet their needs, a person can develop intellectually and physically, develop their production abilities, that is, all components of human capital can be accumulated and used.

It is necessary to invest any resources in its development

For the formation and accumulation of human capital, it is necessary to invest any resources in its development (material, natural, spiritual), as well as to carry out any actions, to perform any functions on its formation and accumulation. This explains the dual definition of investment in human capital. On the one hand, investments are resource investments in the production of human capital, and here it is impossible not to agree with L. Turou that investments include physical capital, human capital, and natural resources. On the other hand, investment is a form of activity, a process of creating human capital, its components. So believed the proponents of the concept of human capital production. Analyzing the concept of investment in human capital, we see that its adherents (L. Turou, M. Blaug and others) adhere to the resource content of investments and do not pay attention to the actions and functions of producing human capital. On the other hand, adherents of the theory of human capital production (T. Schulz, G. Becker, J. Ben-Poret, and others) pay a lot of attention to the functional components. Investments in it (human capital) can be education, the accumulation of industrial experience, health protection, geographical mobility, information retrieval.

The previous experience of various economic trends in the definition of investment in human capital was summarized by Dobrynin A.I., Dyatlov S.A., Tsyrenova E.D. and came to the conclusion that investments can be considered in two ways - as investments of funds and resources and as certain types of activities. In the most general terms, all types of investment in a person that can be valued in monetary or other form, and which are expedient, that is, contribute to the growth of labor productivity and contribute to an increase in human income, is an investment in human capital. On the other hand, the main forms of activity, such as: school education, on-the-job training, health promotion and an increase in the stock of information on the economy, are investment activities that develop human capital.

 

 All investments can be reduced to resources

Analyzing the above approaches to the definition of investment in human capital, we come to the conclusion that all resources and actions can be directly or indirectly expressed in monetary or other form, that is, all investments can be reduced to resources. Consequently, it is possible to give the following definition of investment in human capital. Investments in human capital are the resources that form and accumulate new knowledge, information and experience in the preparation and operation of the labor force, that is, the ability to work. In other words, investment is the cost of producing human capital, and human capital itself, in all its components, is the result of the process of its formation and accumulation.

The costs of producing human capital, as well as the costs of producing physical capital, can be estimated in monetary terms. Resources can be directly estimated in monetary terms, and actions as labor in a particular area through wages, that is, indirectly.

Comparison in economics of results with costs allows us to conclude about the efficiency of resource use, about the effectiveness of economic processes and systems. In this case, the primary importance is the role of investment in the reproduction process.

Human needs are constantly growing, which causes an increase in the production of goods and services. Quantitative and qualitative growth in the production of goods and services requires the improvement of production capacities and human development, that is, the development of all components of human capital. In turn, human development leads to the emergence of new needs from him. In the process of reproduction, all components of human capital need resources or investments. Increasing needs leads to increased investment in human capital. On the other hand, the level of investment in human capital depends on their efficiency. The more effectively investments in human capital are used, the less they are required and vice versa.

 

There are several classifications of investments.

C. McConnell, S. Bruce distinguish three types of investments in human capital: expenditures on education, including general and special, formal and non-formal, on-the-job training; health care costs, which consist of the costs of disease prevention, medical care, diet, housing improvement; mobility costs, due to which workers migrate from places with relatively low productivity to places with relatively high productivity.

 

Fig. 1. The role of investment in the process of reproduction of human capital

Peculiarity is different approach J. Kendrick to the classification of investments in human capital. He divides investments in human capital into material and immaterial. The first includes all costs necessary for the physical formation and development of a person (mainly the costs of giving birth and bringing up children). To the second - the accumulated costs of general education and special training, part of the accumulated costs of health care and the movement of labor. A feature of immaterial investments is that, despite its intangible nature, these costs, multiplying the knowledge and experience of people, contribute to the growth of the productivity of capital embodied in people.

Evaluating investments

In evaluating investments, J. Kendrick takes into account the category of lost earnings of students. Lost earnings are possible incomes that, for example, students would have if they had not studied, but worked. At the same time, study is considered as a diversion of labor, which is already accumulated capital and capable of generating income, from the sphere of current economic activity.

Let us disagree with J. Kendrick, because it is almost impossible to determine the category of lost earnings, because it is not known where the student would work if he did not study, what work he would do, what he would do. On the other hand, the work of a student can be assessed as work for the extraction of knowledge.

Improving knowledge and skills

When improving knowledge and skills, some economists attach great importance to free time. L. Turou writes: Every individual has some initial stock of human time; human time is as basic as a resource. It is the main asset of human capital, allowing an individual to acquire other assets of human capital.

 On the one hand L. Turow is right, time plays a big role in the formation of human capital. But on the other hand, we think it is not necessary to single it out as a separate type of investment, since all people have the same amount of time, but use it differently, they can accumulate different components of human capital at the same time. Even when a person is resting, he accumulates the components of a healthy lifestyle. A. Smith also wrote that a person needs rest in general, and sometimes in the form of entertainment ... The consequences of not meeting this need ... cause ... occupational disease.

Mr. Becker, in his monograph, distinguished between special and general investments in a person. Special training gives employees knowledge and skills that are of interest only for the firm where they were obtained (for example, acquaintance of newcomers with the structure and internal order of the enterprise). In the course of general training, an employee acquires knowledge and skills that can be applied to many other companies (computer training). G. Becker showed that general training is indirectly paid by the workers themselves, when, striving for advanced training, they agree to a lower wage during the period of study, and then they also get income from it. If financing went at the expense of firms, they would lose their investments every time they were fired. And on the contrary, special training is paid by firms and they also get income from it, because otherwise if they were dismissed at the initiative of firms, workers would suffer losses. According to G. Becker, the cost of time and effort of a student is also included in the costs of producing new knowledge and skills. It's hard not to agree with G. Becker. Given the entire previous experience of economists in various fields, S.A. Dyatlov, A.I. Dobrynin and E.D. Tsyrenova suggested this classification of the main types of investments in human capital, which is reflected in fig. 2

 In analyzing the classification of A.I. Dobrynina, S.A. Dyatlova, E.D. Tsyrenova, we allow ourselves to disagree with its second part, with investments that are not reflected in the national accounting. In our opinion, lost earnings and free time do not apply to investments. Free time is rather a common basis necessary for the accumulation and formation of all components of human capital. Moreover, if these investments have not yet been reflected in the national accounting, there is no need to talk about them as independent contributions to human capital. We believe that it is generally inappropriate to divide investments into those that are reflected and not reflected in the national accounting. In addition, the scheme does not take into account investments in the education of children, self-development, self-education of the individual.

Each component of human capital requires certain costs, investments, and activities

Analyzing the above classification of investments in human capital, we conclude that each component of human capital requires certain costs, investments, and activities. Consequently, each type of human capital must have its own type of investment. Hence the conclusion that the types of investments, in their most general form, correspond to the components. Classification of investments, in accordance with the components of human capital, compiled by us, reflect schematically in Fig. 3

Of all types of investments in human capital, the most important are investments in health and education. Investing in health prolongs the working life of a person, and, consequently, the time for the functioning of human capital. A person’s health is his natural capital, one part of which is hereditary and the other part acquired as a result of the costs of the person and society itself. Over the course of a person’s life, there is a gradual deterioration of human capital. Health investments can slow down the process.

 

Fig. 2. Classification of investments in human capital

The research results show that only 8 -10% of human health depends on health, another 20% on environmental conditions, another 20% is determined by genetic factors and 50% depends on the lifestyle of the person himself (rational daily regime, the use of various methods of speedy recovery and stimulation of efficiency, hygiene rational nutrition, getting rid of bad habits and overweight, the formation of a beautiful figure, prevention and elimination of stress, the use of various complexes fi ble exercise, tempering, massage). Thus, the costs associated with maintaining a healthy lifestyle should also be attributed to investment in a person. General and vocational education improves quality, increases the level and stock of human knowledge, thereby increasing the volume and quality of human capital. Investments in higher education are capable of forming highly qualified specialists, whose high-performance labor has the greatest impact on economic growth rates.

Particularly should be allocated a group of expenses for training in production.

Today it is one of the most important components of investment in human capital in all countries of the world. According to O. Nordhoga, in any educational project, up to 80% of knowledge comes from independent learning. This applies especially to the professions of specialists - researchers, teachers, engineers, computer experts, etc., which

they are called upon to continuously update their qualifications through an individual study of the literature, the use of independent educational programs, and training based on the example of the activities, experience and assessments (opinions) of other people.

Today, investment in human capital is also relevant to the costs of basic scientific research. Indeed, in the process of science development, not only intellectual innovations are created, on the basis of which new production technologies and consumption methods are then formed, but people themselves are transformed as business entities acting as carriers of new abilities and needs. In the information society, where developed countries are moving, and where the decisive role will be played by the areas in which the informational wealth of society accumulates due to the development of science, culture, and education, accumulated later in technology, science becomes a kind of generator of human capital.

Fig. 3. Classification of investments in relation to the components of human

capital

The costs of migration and the search for economically significant information contribute to the movement of labor to areas and industries where labor is better paid, to where human capital is used more productively and the price for its services is higher. Investments in raising and caring for children are investments in the reproduction of human capital in the next generation.

In modern conditions it is necessary to single out the spiritual stability and intellectual mobility of a person, which is a conscious, morally-oriented ability to analyze, use the ever-increasing flow of information - information mobility.

Investments in human capital have a number of features that distinguish them from other types of investments.

1. Return on investment in human capital directly depends on the life of its carrier.

2. Human capital is not only subject to physical and moral deterioration, but is also able to accumulate and multiply. Depreciation of human capital is determined, firstly, by the degree of natural wear and tear of the human body and its inherent psycho-physiological functions, and secondly, by the degree of moral (economic) wear due to obsolescence of knowledge or changes in the value of the education received. The increase in human capital is carried out in the process of periodic retraining of the employee and his accumulation of industrial experience, constant health care. If these processes are carried out continuously, then as human capital is used, its qualitative and quantitative (volume, value) characteristics improve and increase.

3. As human capital accumulates, its profitability rises to a certain limit, limited to the upper limit of active labor activity (active working age), and then sharply reduced.

4. Not all investments in humans can be recognized as investments in human capital, but only those that are socially viable and economically necessary. For example, the costs associated with criminal activities are not investments in human capital, because they are harmful to society.

5. The nature and types of investments in a person due to historical, national, cultural characteristics and traditions. Thus, the level of education and the choice of a profession by children largely depends on the family traditions and the level of education of their parents.

6. Compared to investments in other various forms of capital, investments in human capital are most beneficial both from the point of view of an individual and from the point of view of the whole society.

7. Investments in human capital can be measured and expressed in monetary terms, even if you have to resort to indirect indicators (teacher’s salary, childcare nanny, etc.).

 

So, we believe that human capital is objectively characterized by a measure of health, level of knowledge, professional experience, motives, skills, abilities, economically significant information accumulated through life-long investments in a person, his health, intelligence, culture, allowing not only economically to survive to individuals and society as a whole by meeting current needs, but also to develop to bring the ultimate individual socio-economic and social effect, showing camping in the economic growth and social stability.

Human capital plays a pivotal and fundamental role in the system of factors of production, and relations about its formation and use occupy a leading place in the system of market relations.

Socio-economic development at the end of the 20th and the beginning of the 21st century is marked by the increasing role of the human factor. Human investments became one of the most important at the time when the economy was in the industrial phase of its development, but their significance is especially increasing with the transition to the post-industrial economy. Modern economics, Anthony Carnevale considers, is characterized by a steady and ever accelerating transition to the use of not natural resources and machines as the main building material, but skills acquired by people. Human resources are not only becoming more valuable, but they are increasingly reducing the relative importance of natural resources and machinery. This new role is connected with the fact that only they are able to transform other economic resources into goods and services.

This implies the relevance of developing a more accurate toolkit for both human investment itself and various aspects of their efficiency, the role of market and non-market investments in the formation of human capital.

The role of market and non-market investments in human capital can be judged by the degree of socialization of the economy. In accordance with the seventh article of the Constitution of Russia, the Russian Federation is a social state whose policy is aimed at creating conditions ensuring a decent life and free development of a person. Meanwhile, there is no need to prove specifically the vector of economic policy and economic reform in Russia that is directly opposite to this constitutional norm.

Degree of socialization of the economy

The degree of socialization of the economy indicates how much the state is interested in the development of human capital, what is the proportion of investments in human capital on the part of the state, that is, the role of non-market investments in human capital. With the transition to a market economy, market (private) investments in human capital are being pushed to the first place. However, the role of non-market (state) investments should not be underestimated, since they provide support to particular social groups who cannot take care of themselves (retired people, disabled people, the unemployed, etc.); they are the ones that help to regulate at the proper level investments in the human capital of all other groups of the population. This is evidenced by the analysis of the socialization of the economy in developed countries such as Germany and Japan. The main social indicators are regulated and set by the state, no matter how developed the economy is. After all, precisely because the state is socially orienting the economy in these countries and there is a high level of its development and the stability of economic growth is ensured. This is evidenced by the calculation of comparable index indicators characterizing various aspects of the economic and social life of the countries of the world over a number of years, and the determination of the integral index of human development (HDI). Its value varies from 0 to 1. The value of the HDI reflects the degree of human development and the closer it is to 1, the higher the development.

The rating of countries in terms of human development varies over the years, however, the highly developed countries of the seven are naturally in the top twenty. The leading position in this ranking was occupied by Norway in 2011 (0.943). Russia today (in 2011) ranks 66th on the list with HDI = 0.755. The index began to fall with the beginning of the 90s due to a reduction in GDP and an increase in mortality. In 1992, Russia occupied the 52nd place, in 1995 - 114, in 2004 - 57, in 2005 - 62 with the index of 0.795, in 2006 - 65 with the index of 0.797, in 2007 - 71 place with the index of 0.817. However, the index itself is growing, but the growth rate of the index in other countries is ahead of Russia.

 

To the solution of problems on the effective reproduction and use of human capital will lead to the strengthening of the innovative orientation of the socio-economic development of the country. An innovative type of economy requires an appropriate human potential of a new, innovative type.

Person’s creative abilities

A person’s creative abilities are at the core of his innovative potential and, unlike other resources, cannot be exhausted. Creative individuals have such distinctive features as: purposefulness, conviction, scale and perspectivity of thinking; susceptibility to any ideas; initiative with a preference for free unplanned research; critical thinking Mostly creative is the work of inventors, scientists, teachers, doctors, engineers, production managers, entrepreneurs.

In Russia, the most acute problem is the lack of innovative individuals - flexible, capable of generating and implementing innovations, with a high level of professionalism, due to the unique and effective combination of knowledge, skills, skills and personal qualities for successful activity in the field of science and high-tech business technologies. In addition, the possibilities of using and developing the innovative labor potential, and effective involvement of innovative individuals in the labor activity are limited. This is due to the insufficient quality of the educational system, the inefficient structure of employment, the inappropriate progressive technological structure of the economy with free mobility of personnel.

In this regard, the need to create a fundamentally new mechanism for managing the development of innovative labor potential acquires particular relevance. This mechanism should be focused on the formation of a favorable innovation climate, providing for the priority development of science and education, the creation in the economy of internal sources of growth based on active stimulation of innovative labor. The urgent task of modernizing the Russian economy, transferring it to an innovative type of development, is becoming the solution to the problem of training new types of personnel at all levels - from workers to highly qualified specialists who are capable and receptive to innovations. For these purposes, a strong institutional basis is needed for relations between enterprises and institutions of vocational education, the development of new models for the integration of science, education and production, taking into account the logic of the formation of new activities and market segments.

 Research and educational centers

The creation of research and educational centers (RECs) can contribute to the introduction in universities of the international practice of integrating advanced research and education, and the widespread involvement of young people in scientific research.

The main objective of the REC is the expansion of the educational field of the university, interaction with the business environment and business structures.

To achieve this goal, it is necessary to solve the following tasks:

- Establishing links with the university business environment;

- commercialization of additional educational services;

- development of methodological support of new educational services;

- the introduction of modern software in the educational process;

- the creation of structural units for the exchange of innovative technologies;

- development of information base of counseling.

As part of the creation of the REC, it is possible to form an appropriate material and technical base that provides teachers with jobs that are actively involved in research projects and innovative developments. Resources are needed for the material and technical support of the innovation process, the development of the structure involved in the legal registration of intellectual property in the form of patents, applications for invention, financing of work, the results of which are more likely to be developed with a high potential for commercialization. In order to attract external financing, work can be carried out on interaction with regional and municipal authorities, business structures, the Foundation for Assistance to the Development of Small Forms of Enterprises in the Scientific and Technical Sphere. The most important task of the REC is to create conditions for the development of the mobility of scientific and scientific-pedagogical personnel. The most effective use of scientific, personnel, instrumental base in research and educational processes is supposed. The mechanism of consolidation in science through participation in the REC requires young researchers to achieve a level of qualification that will allow them to subsequently be competitive in the market for scientific research.

The activities of the REC can be inscribed in the new type of integrated structures - the cluster approach should be used in the formulation of programs and projects ensuring the innovative development of universities in the field of organizing the educational process and research and innovation activities, and in terms of cooperation with employers.

Fundamental and applied scientific research can be conducted in clusters within the framework of the leading scientific schools established at the university in the priority scientific direction of the cluster. Along with specialized scientific and educational centers, the research infrastructure of clusters can also be made up of research laboratories at the university, centers for the collective use of unique equipment. At the same time, the interaction of the research and education cluster should be optimized with the innovation-active enterprises of the region.

For the production of a cluster, the REC can train specialists, conduct scientific research, provide modern scientific equipment for use, and provide scientific advice. The result of training innovative personnel at the REC should be their willingness to innovate in the professional environment, therefore the purpose of the REC can be the formation of relevant competencies. When preparing innovatively active engineering, scientific and scientific-pedagogical personnel, an important requirement is the participation of associations of industrialists and entrepreneurs, specialists of relevant cluster enterprises in the development of criteria, qualification characteristics and professional competencies of graduates.

 Lack of a common strategy

Due to the lack of a common strategy in the existing RECs in the design and implementation of educational programs, the inertia of personnel, informational, methodological and material and technical resources, there is still not enough high efficiency in training specialists for innovative activities. An innovative culture of engineering, scientific and scientific-pedagogical personnel, confirmed by personal experience of participation in the development, dissemination and introduction of technologies, should be formed. The basis for the training of innovative personnel should be the technology of real modeling of the entire life cycle of an innovative product - from concept to research, from design to implementation of development at the consumer.

In the process of training and retraining, students should be included in the real creative process of creating a new competitive development and ensuring its implementation. The creative process of creating an innovative product and the search for the conditions for its implementation should go in parallel, interacting with each other, forming a competitive specialist, adapted to work in the new economic conditions. The use of innovative educational technologies in the context of the formation of an innovative culture should include the formulation of tasks for developing technical, technological and pedagogical innovations, designing research materials in the form of patents for invention, applications for participation in grants, scientific competitions, and attracting students to participate in the implementation of innovative projects.

The REC activity should be practically oriented to the needs of specific high-tech high-tech manufacturing enterprises that are included in the cluster.

It is advisable to conduct training of students and postgraduates at the RECs not only under the guidance of REC managers, but also with the direct participation of specialists from cluster manufacturing enterprises, who also assess their level of knowledge mastering and remunerate their work. In addition, it is advisable to evaluate the effectiveness of the activities of the faculty of the REC on the basis of the degree of their cooperation with manufacturing enterprises and organizations of the cluster.

It is specialists who have received not only knowledge, but also practical skills in the field of high technologies and high-tech business, representing the innovative elite of society, will be more than demanded in the innovation economy. These processes will lead to the growth of human capital and its more efficient use.

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