Human capital, instability and foreign investment in transition economies

1995 ◽  
Vol 28 (2-3) ◽  
pp. 185-203 ◽  
Author(s):  
Michael Spagat
Keyword(s):  
Human Capital ◽  
Transition Economies ◽  
Foreign Investment

Is the Ukrainian economy’s absorptive capacity appropriate to attract foreign direct investment and facilitate economic growth?

2018 ◽  
Vol 13 (6) ◽  
pp. 1928-1947
Author(s):  
Svitlana Shevelova ◽  
Svitlana Plaskon
Keyword(s):  
Higher Education ◽  
Economic Growth ◽  
Human Capital ◽  
Foreign Direct Investment ◽  
Production Function ◽  
Transition Economies ◽  
Absorptive Capacity ◽  
Direct Investment ◽  
Content Type ◽  
Douglas Production Function

Purpose Despite an increasing volume of literature focussed on foreign direct investment (FDI) in transition economies, there has been little research into FDI in Ukraine. The relationship between the inflows of FDI (IFDI) and absorptive capacity (AC) has been under-researched in the peripheral transition countries like Ukraine. The purpose of this paper is to analyse the appropriateness of the Ukrainian economy’s AC to attract IFDI and facilitate economic growth with a particular focus on AC factors, such as the potential of human resources to absorb innovation and benefit from research and development (R&D) expenditure. Design/methodology/approach This study presents a thoughtful research design: there is an analysis of the AC framework for justification and selection factors that allows a measurement of the potential of Ukraine’s AC to attract and exploit IFDI. The study uses data from 25 regions in Ukraine for the 1996–2015 period. To estimate the effects of IFDI on Ukrainian economic growth, a Cobb–Douglas production function is used. As an appropriate instrumentation technique for dynamic panel data, the Generalised Method of Moments is used to provide unbiased and efficient estimates of the results. The application of the interactive term in this study allows the authors to indicate the existence of complementarities between IFDI and human capital, in particular with higher education, that afford opportunity to absorb new technologies and benefit from IFDI. Findings The resulting model indicates that R&D expenditure benefited very significantly in evolving country’s innovation system due to economic growth. Physical and human capital has not been used effectively in Ukraine to facilitate economic growth and attract IFDI. The number of patents is not significant in all of the regression models. Moreover, IFDI in Ukraine for the 1996–2015 period did not significantly impact on economic growth. However, the AC of human capital, in particular those with a higher education, is relatively relevant to benefit from IFDI. Practical implications The findings have important implications for governmental policy, which should be based on improving the business climate, a strategy for digital development, innovation, migration, institutional and regional policies aimed at the achievement of country’s sustainable economic growth. The government should increase R&D expenditure as an important factor of gross domestic product growth and introduce grants, loans and other financial supports for encouraging students to continue university education. Originality/value The originality and value of this paper is empirical and methodological. The empirical results of this study enable a conclusion about the appropriate level of the country’s absorptive capability required to benefit from IFDI. The paper also contributes to the existing academic debate and proves that despite the well-established theoretical framework for the IFDI–AC economic impact context, a new theorisation is needed to explore the full complexity of the country’s explicit relationship between AC and IFDI. Future research should be focussed on examining not only groups of countries but also distinctly the country’s explicit relationship between AC and IFDI with the particular attention for the under-researched countries: the peripheral transition economies to discover new research niches for theory building. This study presents an original methodological approach with a careful justification of the theoretical framework for hypothesis development, an appropriate sample and an original application of seminal research methods based on the Cobb–Douglas production function. This study proves that the interactive term, which allows indication of the existence of complementarities between IFDI and other variables, is appropriate for measuring AC in countries with smaller amounts of IFDI.

scholarly journals MECANISMOS DE DERRAMAS DE CONOCIMIENTO EN EL CONTEXTO DE LAS RELACIONES ENTRE GRANDES, PEQUEÑAS y MEDIANAS EMPRESAS

2019 ◽  
pp. 79-88
Keyword(s):  
Human Capital ◽  
Foreign Investment ◽  
Direct Foreign Investment ◽  
Economic Policies ◽  
Economic Dynamics ◽  
Controversial Subject ◽  
Palabras Clave ◽  
Capital Humano ◽  
Positive Impacts

MECANISMOS DE DERRAMAS DE CONOCIMIENTO EN EL CONTEXTO DE LAS RELACIONES ENTRE GRANDES, PEQUEÑAS y MEDIANAS EMPRESAS mECHANISmS OF SPILLOVER KNOWLEDGE IN THE CONTExT OF THE RELATIONSHIPS BETWEEN BIG, SmALL AND mID-SIZE COmPANIES Pablo Chauca M. Facultad de Economía, Universidad Michoacana de San Nicolás de Hidalgo Michoacán, México DOI: https://doi.org/10.33017/RevECIPeru2010.0012/ RESUMEN Las relaciones entre empresas grandes y las de menor tamaño (pequeñas y medianas, Pymes) es un tema importante y a la vez polémico. Con los avances de los procesos de globalización, en particular desde las políticas económicas que privilegian la apertura comercial, se enfatiza en los impactos positivos de la inversión extranjera directa en la dinámica económica de los países receptores. En ese contexto, diversos estudios se enfocan al análisis de las derramas provenientes de empresas grandes (transnacionales y nacionales) hacia Pymes locales y suponen que los incrementos de productividad de éstas últimas están relacionados con las derramas de conocimiento desde las grandes. Otras investigaciones destacan las relaciones asimétricas entre las empresas grandes y las Pymes, por tal razón sostienen que los impactos son más negativos sobre las empresas de menor tamaño y no existe significativamente acumulación de aprendizajes, habilidades y capacidades tecnológicas y productivas en las Pymes. Teniendo como marco el debate a partir de estos estudios, el trabajo se propone analizar cuáles son las ventajas y las dificultades que las Pymes enfrentan para el aprovechamiento de las derramas de conocimiento así como cuáles son los mecanismos específicos para su acumulación. Para ilustrar las argumentaciones se toma como referencia la experiencia en algunas ramas industriales de la economía mexicana. Palabras clave: Derramas de conocimiento, capacidades de absorción, vínculos de proveeduría, movilidad del capital humano. ABSTRACT The relationships between big companies and the small and mid-size companies (SMEs) are an important and simultaneously controversial subject. With the advances of the globalisation processes, in particular from the economic policies that privilege the commercial opening, it is emphasized in the positive impacts of the direct foreign investment in the economic dynamics of the receiving countries. In that context, diverse studies focus to the analysis of the spillover of big companies (transnational and national) towards local SMEs and suppose that the increases of productivity of these last ones are related to the spillover knowledge from the big ones. Other investigations emphasize the asymmetric relations between the big companies and the SMEs, for such reason maintain that the impacts are more negative on the smaller companies and significantly does not exist technological and productive accumulation of learnings, abilities and capacities in the SMEs. Having as frame the debate from these studies, the work analyze which are the advantages and the difficulties that the SMEs face for the advantage of the spillover knowledge as well as which are the specific mechanisms for their accumulation. In order to illustrate the argumentations the experience in some mexican industries is taken like reference. Keywords: Spillover knowledge, capabilities of absorption, bonds of provider, mobility of the human capital.

FEATURES OF FOREIGN INVESTMENT IN THE SERVICE SPHERE IN THE RUSSIAN FEDERATION

2021 ◽  
Vol 2 (10) ◽  
pp. 4-7
Author(s):  
Olga P. Pokshivanova ◽  
Keyword(s):  
Human Capital ◽  
Russian Federation ◽  
Foreign Investment ◽  
Service Sector ◽  
The State ◽  
Tertiary Sector ◽  
Business Services ◽  
Easy Task ◽  
Structure And Dynamics ◽  
The Russian Federation

Attracting foreign investment to the Russian service sector in 2021 is not an easy task. It is neces-sary to take into account the peculiarities of the structure and dynamics of the distribution of foreign investment within the tertiary sector. The Russian Federation is lagging behind in attracting investment in industries such as business services, computers, telecommunications and human capital. The state must determine the necessary balance between the liberalization of the service sector and the density of protectionism in the same area. The legislation in force should be taken into account and compared with the practice of neighboring countries.

scholarly journals Economic Law Creation Beautiful Global Indonesia

BESTUUR ◽  
2020 ◽  
Vol 7 (1) ◽  
pp. 47
Author(s):  
Liana Endah Susanti
Keyword(s):  
Human Capital ◽  
Natural Resources ◽  
Surface Area ◽  
Indigenous People ◽  
Foreign Investment ◽  
Wishful Thinking ◽  
Collective Good ◽  
The World ◽  
Investment Law ◽  
Mining Firm

<p><em>Indonesia is the world 's largest archipelago with 1,904,569 km2 of surface area. A very diverse landscape with a variety of abundance of flora and fauna is a special attraction for foreign tourists. Not only that, the natural wealth in Indonesia 's intestines is also very abundant, as are various minerals and richness from other mining materials. However, a abundance of skilled human capital, both in terms of science and technology mastered, do not complement the plentiful natural resources. This is one of the reasons superpowers should be providing cooperation. PT. PT. Freeport is an clear example of Indonesia 's collaboration in the mining sector with foreign parties. The first contract for Freeport-Indonesia was established in 1967. After the Foreign Investment Law was passed in 1967, Freeport became the first foreign mining firm to operate in Indonesia. But the existence of this partnership was regretted by many because it was perceived to be detrimental to the region. The reason is that so far nobody knows for sure how much gold and silver has been produced from the mining to date. The magnitude of the distribution of mining goods is also not quite good given that Indonesia owns land which is turned into gold fields. There are, in fact, many reports uncovering miserable stories of discrimination by indigenous people around the mining region. Justice is once again present as something that is not only wishful thinking, but also noble values that have to be realized for the collective good of the state goals set out in the Pancasila points and the preamble to the Constitution of 1945.</em></p><p><em> </em></p><p><strong>Keywords</strong>: <em>Mining, PT. Freeport, Discrimination, justice</em><em></em></p>

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