I agree with the statement that "Human Capital Formation gives birth to innovation, invention and technological improvements" by :

(i) Expenditure of Education : It is the most effective way of raising a productive workforce in the country. Labour skill of an educated person is more than that of an uneducated person. Individuals invest in education to increase their future income and raise the living standard.

(ii) Expenditure in Health : It is also an important expenditure to build and maintain productive labour force and to improve quality of life of people in the society. It makes a man more efficient and therefore more productive. Their contribution to the production process tends to rise and adds more to GDP than a sick person.

(iii) Expenditure on the Job-training : It helps the workers to sharper their specialised skills. It increases the skill, efficiency and capacity of the workers. It also make workers more creative and innovative which result in increase in production and productivity.