Below are some statements about a family in South America. Match each situation with the term that best describes it. Each term is used only once, so it is important to determine the situation that best fits the term.
1. As a teenager, Juan Carlos worked as an assistant to an electrician after school. Consequently, he learned a lot about being an electrician, an important skill that can result in gainful employment.
2. After graduating from high school, Juan Carlos was able to go to the United States to study. After he finished his college degree, he took a job at a prestigious American firm, married his American girlfriend, and settled in to stay in the U.S.
3. Juan Carlos' father, Alberto, has always been envious of his neighbor\'s aging tractor. The tractor allowed the neighbor to produce 50% more than Alberto, even though their farms are virtually identical.
4. When the neighbor bought a second tractor for his son to drive, their farm\'s output increased again. But they found the second tractor did not increase their output as much as the first one did.
5. Appreciative of his father\'s hard work, Juan Carlos buys Alberto a brand new tractor - the one with the air conditioned cab. Alberto is thrilled when the fancy new machine allows him to almost triple his output; he is now producing more than all his neighbors, many of whom have old tractors.
6. Alberto and his neighbors are troubled by the lack of water in the river that runs by their farms. The laws of their country allow farmers to take limited amounts of water from the river for crop irrigation, but a wealthy celebrity built a villa upstream of the farms and unlawfully diverted much of the water onto his land for a decorative stream and waterfall. Local officials refuse to do anything to help the farmers until they pay a small unofficial 'fee'.
TERMS:
Human capital
Brain drain
Property rights
Catch-up effect
Diminishing Returns
Physical capital