ICT, Human Capital, and Productivity in Chinese Cities

Qing Li and Yanrui Wu
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Qing Li: Department of Economics and Finance, SILC Business School, Shanghai University
Yanrui Wu: Business School, The University of Western Australia, http://www.web.uwa.edu.au/person/yanrui.wu

No 22-05, Economics Discussion / Working Papers from The University of Western Australia, Department of Economics

Abstract: This study uses a rich city-level dataset to analyse the relationship between information and communication technology (ICT) and productivity performance in China during 2003-2016. It is shown that ICT positively contributes to Chinese cities’ productivity in conjunction with other growth determinants, such as human capital, foreign direct investment, infrastructure development, financial market development, and research and development investment. An identifiable amplified effect is detected when ICT exceeds certain threshold in Chinese cities. This threshold level is reached in over a half of Chinese cities particularly cities in coastal regions. Finally, ICT is found to substitute human capital in China’s context. Since the average education level in Chinese cities is low, the finding is in line with the argument that ICT only improves productivity of high-skilled workers but worsens that of the low-skilled ones.

Keywords: ICT; human capital; productivity; China (search for similar items in EconPapers)
JEL-codes: O33 O47 R10 (search for similar items in EconPapers)
Pages: 26
Date: 2022
New Economics Papers: this item is included in nep-cna, nep-eff, nep-fdg, nep-ict, nep-tra and nep-ure
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