What Is Human Capital and Education?

In this text we use terms such as “education for human capital” or “human capital theory in education” to refer to a set of discursive assumptions, or “givens” that underlie most contemporary policy discussions concerning education. Although the concept of human capital theory can be quite complex (hence the existence of this book), its central concept can be reduced to a unifying trope—that is, education is an “investment” that should be judged on the same basis as other financial investments—through future financial gain or loss. In this case the projected gain or loss is determined by the productivity of future labor markets. Decisions concerning schooling can and should be made on the basis of estimated profit that can result from particular curricular and methodological decisions. Furthermore the probable loss or gain that a nation-state or other group that “invests” in schooling incurs can be quantified and assessed or predicted using statistical formulas. As the economist Eric Hanushek states,

I’ve looked at the economic implications of schooling, and people who

know more earn more; nations that do better in school [sic] grow faster

than other nations. Even if we just look at the economic implications, the quality of our schools is extraordinarily important to us as a society and

as individuals. (Hanushek & Boulton, 2012; italics original)

Like most discursive concepts governing our ideas of the “truth” and the “inevitability,” those of human capital theory are not universal but rather specific to a particular historical period and context. The contemporary rationale of education for human capital formation is an outgrowth of, and intertwined with, four separate historical discursive moves that, metaphorically, form four legs on which it rests. These discursive underpinnings are governmentality, statistics and the quantification of human society, the education for development movement, and its unstable relationship with the politics of two separate movements in recent economic theory—Keynesian, the philosophy that has had various names such as monetarism, neoliberalism, and market-oriented economics. In this introduction we will use the latter term, due to the loaded nature of the term “neoliberalism,” its ill-defined nature, and its asymmetric use by proponents and opponents of its policies (Boas & Gans-Morse, 2009).1 The discursive shifts that define these bases for the relationship between the four givens or truths about schooling did not all emerge simultaneously. “Governmentality” emerged somewhere between the sixteenth and eighteenth centuries. The technologies of statistics and probability that made human characteristics “inscribable” (Rose, 1993) and quantifiable emerged gradually, beginning in the sixteenth century, but developed into their contemporary forms mostly over the course of the nineteenth century (Hacking, 1990, 1991). The concept of education for development emerged in the period immediately following WWII in the context of Keynesian economic theory (e.g., see, Escobar, 1995), while current understandings of market-oriented economics began in the 1930s (Denord, 2009) but first came to dominate global economic and educational discourse in the 1980s.

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