Country factors determining the impact of foreign direct investment on economic development

Alexander Knobel, Dmitry Kuznetsov and Ivan Lyubimov
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Dmitry Kuznetsov: Gaidar Institute for Economic Policy
Ivan Lyubimov: Gaidar Institute for Economic Policy

Working Papers from Gaidar Institute for Economic Policy

Abstract: Over 30 years, Moscow's economy, once among the key industrial centers, has gone through a process of sectoral structural transformation, today is predominantly engaged in the provision of services. However, human capital along with labor represents another common production factor in Moscow's economy. The accumulation of knowledge allows the process of reindustrialization to be realized in Moscow, the distinguishing feature of which is the use not so much of simple labor, but of complex skills and knowledge that are required to perform complex industrial operations and manage automated systems. Many new industries in Moscow are preceded by design and research stages, thus localizing more complex links in production chains. Human capital is also used to render technological services, among which we indicate complex projects to transform the city transportation network, modern medical services, and university education. The further development of the Moscow economy and the inflow of foreign investments is connected with a more intensive use of one of the main production factors - human capital. Such development agrees with the existing world experience, in which obtaining investment in more advanced technological links was associated with the accumulation of knowledge, skills and know-how.

Keywords: Russian economy; investment; human capital; economic development (search for similar items in EconPapers)
JEL-codes: F20 J24 O10 O12 (search for similar items in EconPapers)
Pages: 34 pages
Date: 2021, Revised 2021
New Economics Papers: this item is included in nep-cis
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