Human Capital and International Capital Flows: Evidence from China

Zhenshan Yang, Yinghao Pan, Dongqi Sun and Li Ma

International Regional Science Review, 2022, vol. 45, issue 1, 74-107

Abstract: The pattern of international capital flows has changed dramatically in the process of globalization. In this study, we argue that human capital (HC) facilitates a region’s reversal from being a net recipient of external resources to being an active contributor in the global market. Using a panel vector autoregressive regression method, we examine the relationships among regional HC, foreign direct investment (FDI), and outward FDI during 2004–2015 in China. Our results show that HC plays a key role in both attracting FDI and generating outward FDI. The findings contribute to research on the dynamic capacity building of regions participating in the global economy, especially strengthening HC for local economies participating in the global economy as either investment recipients or contributors.

Keywords: human capital; foreign direct investments; outward foreign direct investments; globalization (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:sae:inrsre:v:45:y:2022:i:1:p:74-107

DOI: 10.1177/0160017621989421

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