Does Method Selection Matter? A New Look at FDI and Human Capital in Chinese High-Tech Industries

Abstract

Using the data that comes from China Statistical Yearbook on High Technology Industry, this paper examines the human capital accumulation, the R&D expenditure and the FDI externality effects on the productivity improvement of Chinese high-tech industries. Our empirical results suggest that the effects of FDI and human capital accumulation on technological progress depend in part on the adopted approaches. We believe that the dynamic model dominates the static model estimates. This paper finds little evidence in support of technological spillovers from FDI and indicate that the technological progresses are mainly rooting in human capital accumulation other than technology spillover induced by FDI in Chinese high-tech industry.

Keywords

human capital / R&D expenditure / FDI / total factor productivity (TFP) / dynamic method

RIGHTS & PERMISSIONS

2014 Higher Education Press and Brill