This article presents an overview of the human capital approach to human development and how it has been used for evaluating early education programs. It critiques the human capital approach by considering how its focus on measurable returns on economic investments limits an understanding of the full and complex contribution of early education to young children's development and well-being. The capabilities approach described by Amartya Sen and Martha Nussbaum provides a more thorough framework for understanding the influence of early education on young children's development and well-being. The article proposes that integrating the human capital approach within the capabilities approach addresses the critiques of the human capital approach and provides a more inclusive context for understanding and assessing the full contribution of early education to children's development and well-being. It concludes with the implications that such integration has for assessment practices in early childhood.