The correct option is Human capital is inseparable from its owner..
Explanation
Human capital refers to the stock of knowledge, skills, education, training, and health embodied in an individual. Unlike physical capital (machinery, buildings), which is exogenous and tangible, human capital is endogenous-meaning it is internally generated and resides within the biological entity of the person.
Detailed Analysis:
- Human capital can be easily sold in the market like a commodity. is incorrect: Human capital cannot be sold in the market like a physical commodity. Only the services derived from human capital can be sold. For example, a doctor sells medical consultation (service), not their medical knowledge (capital) itself.
- The owner of human capital need not be present at the place of production. is incorrect: Since human capital is embodied in the body and mind of the individual, the owner must be physically or mentally present during the production process to utilize these skills. In contrast, physical capital can often be utilized without the immediate presence of its owner.
- Human capital is inseparable from its owner. is correct: The statement "endogenously built in the body and mind" implies that the skills and knowledge are an intrinsic part of the individual's existence. Therefore, human capital is inseparable from its owner; one cannot transfer their intelligence or health to another person permanently.
- Human capital does not depreciate with age. is incorrect: Human capital is subject to depreciation. It depreciates due to aging (decline in physical and mental health) and obsolescence (skills becoming outdated due to technological changes). However, unlike physical capital, this depreciation can be reduced through continuous investment in education and healthcare.
Key Takeaway:
The defining characteristic of human capital is its inseparability from the owner, as it consists of intangible assets like skills and health that reside within the individual, unlike physical capital which is separable and tangible.