A Study On The Gain Sharing Of Investment Into Human Capital

The issue of gain sharing is both a theoretical and a practical one in the investment into human capital. The theory of gain sharing has been for a long time in the scope of profits distribution between human capital owners and the corporeal capital owners, neglecting the issue of gain sharing of the carriers investors to human capital investment, that is, how all the investors participate in the gain sharing.This paper states that the investment into human capital is in essence the equity investment into human capital. In other words, the equity of human capital obtains through investment. Therefore, a clear understanding of the equity relationship among the investors can stimulate the owners to put their human capital into investment. In our country, the investor has undergone its changes from simplicity to diversity, and in accordance of it, the same tendency also happens to human capitals, in additions to the intelligence, finance, physical labor, energy and time of the carriers of human capital (individuals), the non-carriers of human capitals (mainly the state and enterprises) also put currency and other corporeal capital, corresponding opportunity costs into it. Therefore, the equity of human capital made up of three investors should belong to the three parties. That is to say: under the condition that application and profits of human capital investment carriers should not be affected, partial equity should be defined to the non-carriers, and be shared by the three parties. As the co-ownership of human capital equity is the foundation for the investors' human capital investment and their profits belonging, it can not be realized effectively if the condition can not be met and relevant contract can't be reached.What should be made clear about the equity relationship of human capital is that this is not the division of equity property right of human capital, but the dominance of various investors in the human capital equity and the approaches of executing the property right. The pattern of human capital equity in moderns times, which is multidimensional, is neither independent nor non-crossed, but either independent or intercrossed. The individuals, enterprises and the state owe respectively parts of human capital equity because of their investment into human capital. Consequently, they all are the income beneficiaries of the investment into human capital. They should share the profits of the investment together and form a community of gain sharing. The gain sharing of investment into human capital means the subjects of investment should gain corresponding profits according to their proportions on the investment under certain economic conditions. As the gain sharing is determined by the equity relationship among the beneficiaries of the investment, the profits gained by the equity owners are determined by how much they owe the human capital equity. Hence, the amount of their profits has nothing to do with the fact that whether they participate in the course of manufacture directly and with labor amount they put into it. It is related to the costs and stocks of human capital in the course. Once the proportion of equity in newly-increased wealth is fixed, the more human capital the owner of equity has, the more profits of investment he will gain, and the more shares in the newly-increased wealth that is created in manufacture are gained. However, enterprises are in uncertain market and their contracts are incomplete; their gross profits are certainly not a constant but a variable. Therefore, the investors can't gain steady rewards because of their investment. Consequently, the investors run the risk of investment into human capital. So the basic traits of gain sharing system investment into human capital are joint capital investment, co-ownership, gain sharing and allocation risks.On the basis of clear equity patterns and equity ownership, the contracts according to gain sharing should standardize the rights and obligations among the beneficiaries and confirm the proportions of gain sharing and the...