Foreign direct investment and country-specific human capital

Jinyoung Kim, Jungsoo Park

Research output: Contribution to journalArticle

9 Citations (Scopus)

Abstract

This paper exploits an international bilateral data set over the period 1963-1998 to investigate the relationship between foreign direct investment (FDI) and foreign-educated labor in an FDI host country. Workers educated abroad acquire country-specific human capital that is more productive in the host country of study. A foreign subsidiary sharing a parent firm's technology will invest more if it has more foreign-educated labor, since it can utilize this labor more productively because of the country-specific human capital. Consistent with our predictions, our empirical findings show that foreign-educated labor accounted for a sizable portion of growth in FDI flows.

Original languageEnglish
Pages (from-to)198-210
Number of pages13
JournalEconomic Inquiry
Volume51
Issue number1
DOIs
Publication statusPublished - 2013 Jan 1

ASJC Scopus subject areas

  • Business, Management and Accounting(all)
  • Economics and Econometrics

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