'School dropouts are giving way to child labour'. Discuss how this is a loss to human capital.
When children drop out of school to become child labourers, they miss out on investment in education, which is a main source of human capital formation. Education converts human beings into human capital by enhancing labour productivity and equipping them with acquired abilities.
Without education, these children fail to develop skills to become competent professionals. Consequently, society loses the good human capital needed to produce other human capital out of human resources.
Furthermore, this deprives them of the ability to read and write, which is integral to human well-being and human development. This lack of education prevents them from increasing their future income sources and making choices they value, causing a permanent loss to human capital.
Explanation
The answer explains that education is a primary source of human capital formation. School dropouts who turn to child labour miss this investment, losing out on enhanced labour productivity and future income. It also highlights the loss to society, which needs good human capital to produce other human capital, and the loss to human development, as children are deprived of the ability to read and write.