Developing human capital for economic growth: Accessing the case of the Czech Republic

Abstract

Many growth theories stipulate that the capacity and training of people to use knowledge effectively (human capital) propels economic development in the contemporary open knowledge-based economy, hence the striking differences observed in the economic growth of different countries. Among the models created to analyze economic growth, Neoclassical and Endogenous models stand out with their varying views on the role human capital plays in the growth of the economy. In recent years, the Central and Eastern European countries have seen increasing economic growth with the Czech Republic benefited since the adoption of the open economic system. A qualified as well as inspired workforce can support strategic plans of firms and countries alike in notching a niche by increasing productivity, which eventually may contribute to economic growth as research suggest. The human capital of every nation comprises the intrinsic value; culture, health, knowledge, abilities, and skills employed for the execution of economic policies of countries. In view of this, the paper seeks to review the linkages that exist between the existing economic growth and human capital in the Czech Republic. Using the case study methodology, the research found that the level of the human capital development is a key indicator of the states' competitiveness in the Czech Republic. Coupled with increasing flow of Foreign Direct Investment (FDI), the Czech Republic have seen massive economic development in recent times.