Abstract:

American senior managers now demand greater clarity about how a business organization’s people create value for the stakeholders, demanding the linking of human capital with business outcomes, and suggesting that the senior managers were regressing to earlier times. This article’s objective is to investigate critically the genesis and character of human capital. Human capital is the present value of a person's future income from his own labour. The question is whether the concept “human capital” seeks somehow to direct labour, and if so, how. We try to show that the term ‘human capital’ suggests the formation of a new institution, fully operational since the 1960s. It acts to differentiate the capital values of people, and thereby their incomes, through assessments of their different kinds of usefulness to society. In consequence of international human capital rules, the institution of human capital directs the universities, and they so direct their students with the force of differential degree status. The various degrees take on various arbitrary ranks of work status, applying an institutional human capital force to people who want to raise their incomes.