A Study Of Human Capital Investment In Shandong Rural Region

The countryside development is a coax which is closely related to the future development of China. The level of rural human capital should be largely improved as a basic prerequisite to promote the new countryside construction, develop modern agriculture, ensure a constant growing of peasant income and attain the goal of urbanization, and so on. However, some problems such as what the real condition of the rural human capital is and which factors may set back the human capital improvement in peasants may not be scrutinized and understood deeply enough. Particularly, the studies of the condition of rural human capital in province wide are scarce. For these reasons, Shandong province is taken as a research object in this article. According to the relevant data of the province, especially data from a big scale investigation and research which was organized by the writer, through the following four facets, including the formal education system, on-the-job training, medical care and health and employment transfer, the article has fully investigated the current situation of rural human capital investment in Shandong province, and some existing problems and constraining factors in this area, finally, the writer gives some countermeasures to solve these problems.The structure of this article is as follows: the introduction includes the research background, significance, main content, study method and the basic situation of the investigation embraced in the article. And then, the article reviews the former studies on human capital, human capital investment and Chinese rural human capital investment. The writer also gives clear definitions for these questions. After that, the writer uses the data and materials obtained from the investigation and research and carries out an comprehensive analysis according to four factors-education, training, medical care and health and employment transfer-which greatly affect the formation of human capital.In the area of education, the rural elementary education investment and teaching conditions have been improved in Shandong province, but the entire standard is still at a much low level. Although the vocational education is at the first place in nationwide, it still has large lag compared with other advanced province. Moreover, there are significant differences between the western part and eastern part in the province. Through the econometric analysis, the writer finds that there is no significant relationship between the elementary education and peasant income. On the other hand, the vocational education investment has an obvious effect on raising the peasant income. Therefore, first of all, it is necessary to increase the input in vocational education in order to raise peasant income as soon as possible. Secondly, the elementary education standard should be steadily improved, since this is the basis of vocational education and human capital accumulation.In the respect of training, under the government promoting, the peasants have received big-scale training. The training input, system and effects have been largely enhanced and some of the special training modes, which have their local characteristic, have been developed all over the province. However, there is still big gap compared with other advanced provinces and places, the development of interior places of the province are also lack of balance, in particular, the phenomenon of mixed policy system and institutional inconsistent in promoting the training policy exist in Shandong province. According to the econometric analysis, the writer finds that training has a significant effect on raising peasant income. Therefore, clarifying the policy system, creating sufficient innovations in the area of training mode and putting more strength on training program can increase the standard of rural human capital and peasant income.In the area of labor transfer, the province sticks to the way that transfers the rural labor forces in the local places, mainly by developing the local economy in order to transfer the rural labor forces into non-rural areas. As a result, the surplus rural labor forces of the west could flow to the east places in the province. However, under the constraints of old beliefs, conventions, institutions and other qualifications, there are almost ten millions of population need to be transferred in the province. Accordingly, it is necessary to keep developing the local economy in order to promote the rural labor forces transfer. On the other hand, the old beliefs, convention and other obsolete institutions should be broken and unfettered in order to accelerate the rural surplus labor forces transfer.In the medical care and health respect, the rural medical care and sanitation industry has received fast development in Shandong province. The rural cooperative medical care system, in particular, has received faster development and the whole rural population health standard stands well. However, there is a great gap between the input of rural cooperative medical care system and the health care demanded by rural population. Still, the different places in the province may have much different condition. Therefore, more efforts should be devoted in order to find multi-directional medical care mode and smooth the medical care administration institution. In addition, the government should consistently enlarge the input to the rural medical care system to enhance the health standard of rural population.The final parts of the article give a conclusion and suggest the way by which to get over"the trap of self-cure of the low-level human capital investment". It is the low rate of return on the rural human capital investment that inhibits the subjects initiative--peasants initiative in rural human capital investment. Consequently, it results that the human capital investment has been trapped at a low-level in a very long time. Therefore, it is necessary to get over"the trap of self-cure of the low-level human capital investment"in order to change current situation of the rural human capital investment completely.Main conclusions in this article: First, the level of rural human capital investment in Shandong is rather low on the whole. Particularly, the rate of return on investment is low, the relationship between peasant income and some formative factors of investment is not clear either. Second, the peasant is lack of obvious initiative in the process of investment formation. In fact, the formation of rural human capital investment is mainly driven by government. However, the external support such as government is not sufficiently sustainable and systematical; the level of institutionalization is not adequate either. Third, some factors such as vocational education and training which is helpful to directly increase the employment opportunity and income level for the peasant have direct and positive effect on the level of rural human capital in Shandong Province. Fourth, the key of increasing the level of rural human capital investment in Shandong lies in getting away from"the trap of self-cure of the low-level human capital investment". Therefore, in the short term, the government should set the peasant income increase as a fundamental goal and focus on the development of vocational education and training in rural region; while in the long run, the government should gradually improve the rate of return on investment, increase the price level of rural labor force, promote rural human capital to become virtuous self-circle. Meanwhile, the government should expand the investment on elementary education and medical care and health services improve the internal basis of rural human capital investment, increase the level of rural human capital, by doing so the government could construct a fundamental and long-effect mechanism to enhance the peasant income.Main innovations in this article: First, the writer determines the major impact of four factors on promoting the formation of rural human capital in Shandong Province, which includes education, training, medical care and health services, and employment transfer. Applying the abundant and first hand information obtained in the rural survey which was organized by the writer himself, with the help of relevant statistical data, the writer analyses the current situation and characteristic of rural human capital investment in Shandong, and gives a comprehensive generalization in the article. Through the analysis and generalization, the writer confirms the relationship between peasants income and education, training, as well as peasants transfer, enriches the study on provincial rural human capital investment. Second, the writer puts forward and explains a theory which is called"the trap of self-cure of the low-level human capital investment". Third, from the perspective of rural human capital investment, the writer gives some political advices on how to create a long-effect mechanism for increasing peasant income in Shandong Province.