CHAPTER - 2
PEOPLE AS RESOURCE
MEANING OF RESOURCE
→ Anything that can be used to satisfy a need/want is a resource. Utility or usability makes
an object or substance a resource.
→ Example: - Water, electricity, rickshaw, vegetable, textbook, mobiles, etc.
TYPES OF RESOURCES
→ Resources are generally classified into natural, human made and human.
Natural Resources
→ Resources that are drawn from Nature and used without much modification are called
natural resources.
→ Example: - Air we breathe, the water in our rivers and lakes, the soils, minerals are all-
natural resources.
Human Made Resources
→ People use natural resources to make buildings, bridges, roads, machinery and vehicles,
which are known as human made resources. Technology is also a human made resource.
Technology is the application of latest knowledge and skill in doing or making things.
Human Resources
→ Human Resource refers to the number (quantity) and abilities (mental and physical) of the
people.
IMPORTANCE OF HUMAN RESOURCE
Population is an asset for the economy rather than a liability.
a) Population becomes human capital when there is investment made in the form of education,
training and medical care. Human capital is the stock of skill and productive knowledge
embodied in them. Skill is the ability to do something well.
b) Human Resource emphasises its ability to contribute to the creation of the Gross National
Product (GNP). GNP refers to all economic output produced by a nation’s normal residents,
whether they are located within the national boundary or abroad.
c) Education, training and medical care facilities added to the quality of labour. This enhances
the total productivity and adds to the growth of the economy.
d) More educated and the healthier people gain through higher incomes
e) Society also gains in other indirect ways because the advantages of a more educated or a
healthier population spreads to those also who themselves were not directly educated or
given health care.
f) Human capital is in one way superior to other resources like land and physical capital:
human resource can make use of land and capital. Land and capital cannot become useful
on its own.
→ When the existing ‘human resource’ is further developed by becoming more educated and
healthier, we call it ‘human capital formation’.
→ Improving the quality of people’s skill so that they are able to create more resources is
known as Human Resource Development (HRD).
→ Human Resource Development Ministry was created in 1985 to improve people’s skill.
→ Efficiency and technology evolved by people have made countries rich/developed.
, Difference between Human Capital and Physical Capital
Human Capital Physical Capital
→ Ownership cannot be changed → Ownership can be changed
→ Restricted mobility → Highly mobile as compared to that of
human capital
CLASSIFICATION OF ACTIVITIES INTO SECTORS
→ Activities can be divided into three sectors on the basis of the nature of activities. This
categorization is based on their distance from the natural environment.
a) Primary Sector: It is concerned with the utilization of raw materials from nature such as
agriculture and mining.
Agriculture, mining, forestry, poultry farming, grazing, hunting and food gathering, etc. are
included in this sector.
Primary sector tends to dominate the economies of developing nations.
b) Secondary Sector: The secondary sector of the economy manufactures finished goods.
All the manufacturing, processing and construction activities are within the secondary
sector. This sector uses the output of the primary sector.
c) Tertiary Sector: The tertiary sector of the economy is the service sector.
It provides services to the general population and business.
The activities included are banking, finance, insurance, investment, and real estate
services; wholesale, retail, and resale trade; transportation, information, and
communications services; professionals, consulting legal and personal services; tourism
hotels, restaurants, and entertainment; education and teaching, health, waste disposal,
administration, police, security, and defense services.
Services are defined in conventional economic literature as intangible goods.
→ The activities in the three sectors result in the production of goods and services adding
value to the national income. These activities are called Economic Activities.
→ Economic activities have two parts - market activities and non-market activities.
Market Activities Non-Market Activities
➢ Market activities involve ➢ Non-market activities are the
remuneration to anyone who production for self-
performs i.e., activity consumption.
performed for pay or profit. ➢ includes consumption and
➢ These include production of processing of primary product
goods or services including and own account production of
government service. fixed assets.
LABOUR DIVISION BETWEEN MEN AND WOMEN
WOMEN
→ Looks after household activities/non market activities
→ Due to low education and low skilled formation most women work in less job security
areas.
MEN
→ Men in Indian society generally performs market activities
→ They are paid higher than that of women for the same work
PEOPLE AS RESOURCE
MEANING OF RESOURCE
→ Anything that can be used to satisfy a need/want is a resource. Utility or usability makes
an object or substance a resource.
→ Example: - Water, electricity, rickshaw, vegetable, textbook, mobiles, etc.
TYPES OF RESOURCES
→ Resources are generally classified into natural, human made and human.
Natural Resources
→ Resources that are drawn from Nature and used without much modification are called
natural resources.
→ Example: - Air we breathe, the water in our rivers and lakes, the soils, minerals are all-
natural resources.
Human Made Resources
→ People use natural resources to make buildings, bridges, roads, machinery and vehicles,
which are known as human made resources. Technology is also a human made resource.
Technology is the application of latest knowledge and skill in doing or making things.
Human Resources
→ Human Resource refers to the number (quantity) and abilities (mental and physical) of the
people.
IMPORTANCE OF HUMAN RESOURCE
Population is an asset for the economy rather than a liability.
a) Population becomes human capital when there is investment made in the form of education,
training and medical care. Human capital is the stock of skill and productive knowledge
embodied in them. Skill is the ability to do something well.
b) Human Resource emphasises its ability to contribute to the creation of the Gross National
Product (GNP). GNP refers to all economic output produced by a nation’s normal residents,
whether they are located within the national boundary or abroad.
c) Education, training and medical care facilities added to the quality of labour. This enhances
the total productivity and adds to the growth of the economy.
d) More educated and the healthier people gain through higher incomes
e) Society also gains in other indirect ways because the advantages of a more educated or a
healthier population spreads to those also who themselves were not directly educated or
given health care.
f) Human capital is in one way superior to other resources like land and physical capital:
human resource can make use of land and capital. Land and capital cannot become useful
on its own.
→ When the existing ‘human resource’ is further developed by becoming more educated and
healthier, we call it ‘human capital formation’.
→ Improving the quality of people’s skill so that they are able to create more resources is
known as Human Resource Development (HRD).
→ Human Resource Development Ministry was created in 1985 to improve people’s skill.
→ Efficiency and technology evolved by people have made countries rich/developed.
, Difference between Human Capital and Physical Capital
Human Capital Physical Capital
→ Ownership cannot be changed → Ownership can be changed
→ Restricted mobility → Highly mobile as compared to that of
human capital
CLASSIFICATION OF ACTIVITIES INTO SECTORS
→ Activities can be divided into three sectors on the basis of the nature of activities. This
categorization is based on their distance from the natural environment.
a) Primary Sector: It is concerned with the utilization of raw materials from nature such as
agriculture and mining.
Agriculture, mining, forestry, poultry farming, grazing, hunting and food gathering, etc. are
included in this sector.
Primary sector tends to dominate the economies of developing nations.
b) Secondary Sector: The secondary sector of the economy manufactures finished goods.
All the manufacturing, processing and construction activities are within the secondary
sector. This sector uses the output of the primary sector.
c) Tertiary Sector: The tertiary sector of the economy is the service sector.
It provides services to the general population and business.
The activities included are banking, finance, insurance, investment, and real estate
services; wholesale, retail, and resale trade; transportation, information, and
communications services; professionals, consulting legal and personal services; tourism
hotels, restaurants, and entertainment; education and teaching, health, waste disposal,
administration, police, security, and defense services.
Services are defined in conventional economic literature as intangible goods.
→ The activities in the three sectors result in the production of goods and services adding
value to the national income. These activities are called Economic Activities.
→ Economic activities have two parts - market activities and non-market activities.
Market Activities Non-Market Activities
➢ Market activities involve ➢ Non-market activities are the
remuneration to anyone who production for self-
performs i.e., activity consumption.
performed for pay or profit. ➢ includes consumption and
➢ These include production of processing of primary product
goods or services including and own account production of
government service. fixed assets.
LABOUR DIVISION BETWEEN MEN AND WOMEN
WOMEN
→ Looks after household activities/non market activities
→ Due to low education and low skilled formation most women work in less job security
areas.
MEN
→ Men in Indian society generally performs market activities
→ They are paid higher than that of women for the same work
