Does human capital endowment of foreign direct investment recipient countries really matter? evidence from cross-country firm level data

Bhaumik, Sumon Kumar and Dimova, Ralitza (2013). Does human capital endowment of foreign direct investment recipient countries really matter? evidence from cross-country firm level data. Review of development economics, 17 (3), pp. 559-570.

Abstract

The stylized literature on foreign direct investment (FDI) suggests that developing countries should invest in the human capital of their labor force in order to attract FDI. However, if educational quality in developing country is uncertain such that formal education is a noisy signal of human capital, it might be rational for multinational enterprises to focus more on job-specific training than on formal education of the labor force. Using cross-country data from the textiles and garments industry, we demonstrate that training indeed has a greater impact on firm efficiency in developing countries than formal education of the workforce.

Publication DOI: https://doi.org/10.1111/rode.12050
Divisions: Aston Business School > Economics finance & entrepreneurship research group
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Additional Information: This is the peer reviewed version of the following article: Bhaumik, S. K., & Dimova, R. (2013). Does human capital endowment of foreign direct investment recipient countries really matter? evidence from cross-country firm level data. Review of development economics, 17(3), 559-570, which has been published in final form at http://dx.doi.org/10.1111/rode.12050. This article may be used for non-commercial purposes in accordance With Wiley Terms and Conditions for self-archiving.
Uncontrolled Keywords: Geography, Planning and Development,Development
Published Date: 2013-08

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