HUMAN CAPITAL AND THE ROLE OF GOVERNMENT IN EDUCATION

BY :BROTO MUDJIANTO ( 7617121192)DINA PURNAMA SARI (7617121203)

HUMAN CAPITAL

Human capital, is the knowledge, skills, and abilities that can be used to produce a professional service. Human capital reflects the collective ability of the company to produce the best solutions based on the knowledge possessed by the people who are in the company.

Development of human capital, among others can be done through: 1.Internalization of Corporate Culture2.Ensure the implementation of Good Corporate Governance 3.Developing the HR professional as a productive human capital and prudent4.Creating a leader / leader as a role model and people manager5.Uphold and improve legal compliance

HUMAN CAPITAL

Human capital is the stock of competencies, knowledge, social and personality attributes, including creativity, embodied in

the ability to perform labor so as to produce economic value ( Wikipedia)

Human capital represents the human factor in the organization; the combined intelligence, skills and expertise

that gives the organization its distinctive character. The human elements of the organization are those that are

capable of learning, changing, innovating and providing the creative thrust which if properly motivated can ensure the

long-term survival of the organization(Bontis et al, 1999)

The Value of Human capital

Kiker (1966), the valuation of human capital classification :The Cost Production Approach

The basic approach is the assumption that the value of man is equel to the value of resources expended in his “production”

The Capitalized Earning Approach There is no a priori connection between the value of

resources spent in behalf of a person and the market value of the persons

Human capital in the early economic thought

”The improved dexterity of a workman may be considered in the same light as a machine or instrument of trade which facilitates and abridges labor, and which, though it costs a certain expense, repays the expense with a profit.”

Adam Smith, 1776 The Wealth of Nations

Human capital in the early economic thought

”There is no doubt about the answer to the very controversial question of whether the immaterial goods (services) of mankind form a part of national wealth or not. Since the more highly schooled nation, equipped with the same material goods, creates a much larger income than an uneducated people, and since this higher schooling can only be obtained through an educational process which requires a larger consumption of material goods, the more educated nation also possesses a larger capital, the returns of which are expressed in the larger product of its labor.”

Von Thünen 1875

Human Capital in the Early Economic Thought

The motives which induce a man and his father to invest capital and labor in preparing him for his work...are similar to those which lead to the investment of capital and labor in building up the material plant and the organization of business. In each case the investment ..is carried up to that margin at which any further investment appears to offer no balance of gain...and the price, that is expected for all this investment, is therefore a part of the normal expenses of production of the services rendered by it. Alfred Marshall (1890)

Theory: Human Capital

Education increases peoples ability to add value (productivity) HCM

+ =

Man Incr MP of L Incr profits Incr wageSkills & health

EDUCATION AND INCOME

INVESTMENT IN EDUCATION INVESTMENT IN EDUCATION

HIGHER PRODUCTIVITY

HIGHER EARNINGS

- Human Capital Theory

HRM Objectives

1 increasing value of the human capital

2 recruiting and maintenance HR

3 HR skills and capability development

4 Identifications and compensation

5 Cost and effectiveness system result

6 Efficient administration

Human Capital

• Human capital is individual’s productive skills, talents and knowledge.

• Education and training raise the productivity of workers by imparting useful knowledge and skills.

• Education involve currents costs but future returns.

Human Capital

• Skills• Knowledge• Experience• Personal qualities

Sources : California Council on Economic Eduacation ( CCEE)

Development of Knowledge

• Support for scientific research, • Private incentive for R&D and innovation, • Alternative opportunities for talented

individuals • Learning-by-doing.

(Romer, 1996)

Sources of Knowledge

• Formal education• Informal education• Family influence• Government support

Skill is the ability, coming from one's knowledge, practice, aptitude, etc., to do something well

To compete in a global economy, people will need these skills

Basic Skills

Thinking Skills

• Informed decisions

• Benefit/Cost Analysis

• Know how to learn

Interpersonal Skills

• Work well with others

• Help others succeed

• Get along with others who are not like you? • Kind to others

• Try to make others comfortable

Personal Qualities

• Honest

• Hard working

• Respectful

• Self-motivated

• Trustworthy

HUMAN CAPITAL

•The skills and knowledge that allow people to make money are their best asset•People’s skills influence their income

Which house would you like?

A B

Which car would you like?

What Kind of Job Do You Want?

How will you get

From Here To there

Intellectual Capital

Social Capital Organizational Capital

Human Capital

1. Individuals generate, retain and use knowledge and skill (human capital) and create intellectual capital

2. Their knowledge is enhanced by the interactions between them (social capital) and generates the institutionalized knowledge possessed by an organization (organizational capital)

Human Capital Armstrong (2006)

‘An organization’s success is the product of its people’s competence. That link between people and performance should be made visible and available to all stakeholders.’

Armstrong (2006)

Leadership Initiatives

Good organizational Climate (Open)

Trust

High Performance/ High Commitment

Effect of Human Capital for Organization Success

Feel valued / treated fairly

Effect of Human Capital on Organization’s Performance

Employees have the skill / high commitment

They devote all their energy and ability to the organization

Organizational Effectiveness & EfficiencyProductivity increases

Encourage organizationsto thrive/growth

Value (value) of the organization can be delivered to the customer through a human capital

You are the only one who can develop your human capital….. not your teachers, not your parents, YOU

THE ROLE OF GOVERNMENT IN EDUCATION

The Debate ( Pro & Contra)

1. Government should not have any role in education

2. Government have to play some role in the financing/ or provision of educational services

E,G West (1970)

Governmental involvement in education :State protection of minorsExternal effects ( neighbourhood)Education and DemocracyEquality of OpportunityThe Quest for Common ValueEducation and Economic Growth

Education & Inequality

How do we define inequality?

How does education influence these inequalities?

EDUCATION

Sources : Nicholas Spaull (nicspaull.com/research) South Africa

THE ROLE OF GOVERNMENT( Indonesian version)

1. Role as a public servant,2. Role as a facilitator,3. Role as a companion ( Ki Hajar Dewantoro filosofi)

4. Role as a partner, and5. Role as funder.

( Sihombing, 2001)

THE ROLE OF GOVERNMENT

1. Government as regulator2. Government as mandate of the 1945 Constitution3. Government as a provider resources

- Facilities and infrastructure- Financing- Human resources

4. Local Government as the smallest autonomous region responsible for the implementation of education in their region

The Legal AspectUUD ’45 Pasal 31

1.Setiap warga negara berhak mendapat pendidikan.2.Setiap warga negara wajib mengikuti pendidikan dasar dan pemerintah wajib membiayainya.3.Pemerintah mengusahakan dan menyelenggarakan satu sistem pendidikan nasional, yang meningkatkan keimanan dan ketakwaan serta akhlak mulia dalam rangka mencerdaskan kehidupan bangsa, yang diatur dengan undang-undang.4.Negara memprioritaskan anggaran pendidikan sekurangkurangnya dua puluh persen dari anggaran pendapatan dan belanja negara serta dari aggaran pendapatan dan belanja daerah untuk memenuhi kebutuhan penyelenggaraan pendidikan nasional.5.Pemerintah memajukan ilmu pengetahuan dan tekhnologi dengan menjunjung tinggi nilainilai agama dan persatuan bangsa untuk kemajuan peradaban serta kesejahteraan umat manusia.

The role of government in the Autonomous of Education

• The Government sets the standard quality of education that the diversity of student achievement do not differ in any educational institution

• Government to guarantee equal opportunities for all society to get an education

• Government to formulate common policies, technical services, and monitoring program on a regular basis

-Rehab Gedung Sekolah-Penyediaan Lab dan

Perpustakaan-Penyediaan Buku

Kurikulum 2013

-BOS-Bantuan Siswa Miskin

-BOPTN/Bidik Misi (di PT)

Manajemen Berbasis Sekolah

-Peningkatan Kualifikasi & Sertifikasi

-Pembayaran Tunjangan Sertifikasi

-Uji Kompetensi dan Pengukuran Kinerja

Pengembangan Pendidikan Mengacu Pada 8 Standar

Sedang Dikerjakan

Telah dan terus Dikerjakan

3737

Conclusion

1. Human capital, is the knowledge, skills, and abilities that can be used to produce a professional service

2. For organization HC is the collective ability of the company to produce the best solutions based on the knowledge possessed by the people who are in the company

3. Human capital is an individual benefit to employees but also was instrumental in the progress of the company

Conclusion

4. The role of Government is nedeed

Government as regulatorGovernment as a provider resources

- Facilities and infrastructure- Financing- Human resources

protection of minors, external effect, common value, equality of opportunity, democracy and for economic growth