Which of the following types of capital is more mobile between countries?
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → Physical capital
Physical capital is completely mobile between countries, apart from some artificial trade restrictions. Human capital is not perfectly mobile, as nationality and culture restrict movement.
NCERT (2026-27): “Box 4.1: Physical and Human Capital … The two forms of capital differ in terms of mobility across space. Physical capital is completely mobile between countries except for some artificial trade restrictions. Human capital is not perfectly mobile between countries as movement is restricted by nationality and culture. …” |