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Human Capital Formation and Foreign Direct Investment in Developing Countries

Koji Miyamoto

No 211, OECD Development Centre Working Papers from OECD Publishing

Abstract: This paper synthesises the existing literature on human capital formation and foreign direct investment (FDI) in developing countries. The aim is to take a bird’s eye view of the complex linkages between the activities of multinational enterprises (MNEs) and policies of host developing countries. In doing so, general trends, best practices and policy experiences are extracted to evaluate the current state of knowledge. The literature indicates that a high level of human capital is no doubt one of the key ingredients for attracting FDI, as well as for host countries to gain maximum benefits from their activities. Most developing countries, however, underinvest in human capital, and the investment that is actually taking place is unevenly distributed across countries and regions that have adopted different human resource development (HRD) policies. To improve human capital formation and thus to attract more FDI would therefore require a more coherent approach that takes host country ... Ce Document technique propose une synthèse des travaux existants sur la formation du capital humain et l’investissement direct étranger (IDE) dans les pays en développement. Il vise à examiner de près les relations complexes qui s’établissent entre les activités des multinationales et les politiques des PED d’accueil. Cette synthèse permet d’identifier les tendances générales, les meilleures pratiques ainsi que les expériences politiques afin d’évaluer l’état actuel des connaissances. Il en ressort que le niveau élevé du capital humain est de toute évidence l’un des principaux facteurs permettant d’attirer les IDE et — pour le pays d’accueil — de tirer le plus grand profit de leurs activités. Mais la plupart des pays en développement n’investissent pas suffisamment dans le capital humain, et l’investissement actuel est inégalement réparti entre les pays et les régions, dont les politiques de développement des ressources humaines (DRH) sont différentes. Pour améliorer la formation ...

Date: 2003-07-01
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