In August 1945, the United States dropped atomic bombs on the Japanese cities of Hiroshima and Nagasaki. This took Japan many years back in terms of development. Everyone thought it would take decades for the country to reach back to its initial state. After the atomic bombing, it was rumored that nothing will grow in these cities for 75 years. Surprisingly, Japan built its economy in no time. The reason? It’s investment in the human resources, especially in the field of education and health. It is one of the countries having very little amount of natural resources but still comes in the list of developed nations. Due to investment in human resources, this country’s people have made efficient use of limited resources like land and capital. This reason, among many, made countries like US and Canada to expend on developing their human capital. India also recognized the importance of human capital in economic growth in one of its five year plans. Investment in human resources becomes all the more important for India, it being a highly populated country. It is pertinent to note that it is important to invest in country’s human resources even if such investments do not result in higher labour productivity. This is where concept of human development steps in. It is based on the idea that it is only when people have the ability to read and write and the ability to lead a long and healthy life that they will be able to make other choices which they value.

Which of following statements is correct?
Statement 1: Human development treats human beings as a means to an end.
Statement 2: Human capital treats human beings as ends in themselves.

Both the statements are false.

The correct answer is Option 2: Both the statements are false.

Statement 1: Human development treats human beings as a means to an end. This is incorrect. Human capital (NOT HUMAN DEVELOPMENT) treats human beings as a means to an end
Statement 2: Human capital treats human beings as ends in themselves. This is also incorrect. In the human development perspective (NOT HUMAN CAPITAL PERSPECTIVE), human beings are ends in themselves. 

HUMAN CAPITAL AND HUMAN DEVELOPMENT: The two terms sound similar but there is a clear distinction between them. Human capital considers education and health as a means to increase labour productivity. Human development is based on the idea that education and health are integral to human well-being because only when people have the ability to read and write and the ability to lead a long and healthy life, they will be able to make other choices which they value.

Human capital treats human beings as a means to an end; the end being the increase in productivity. In this view, any investment in education and health is unproductive if it does not enhance output of goods and services. In the human development perspective, human beings are ends in themselves. Human welfare should be increased through investments in education and health even if such investments do not result in higher labour productivity. Therefore, basic education and basic health are important in themselves, irrespective of their contribution to labour productivity. In such a view, every individual has a right to get basic education and basic health care, that is, every individual has a right to be literate and lead a healthy life.