Effects of Foreign Direct Investment and Human Capital Formation on Labor Market in Manufacturing Sector in Bangladesh

Abstract Objective: The main objective of this paper is to reveal the relationship between foreign direct investment (FDI) and human capital. Methodology: The analysis consists in a presentation of main achievements in the literature regarding the contribution of human capital to the attraction of FDI. Findings: The investment in human capital formation has leaded to the increase of labour productivity. This will ultimately result in economic growth. Education has the most important role in the process of human capital formation. Value added: FDI has an important role to play in human resource development through its ability to enhance new skills, information and technologies in multinational enterprises. In this way, FDI becomes a determinant factor for education and professional training, because it is the link between the immediate reality based on creation, introduction of new skills, new technologies and provision of a wide range of information and initial training direction. Recommendations: The economic policies should focus on the attraction of FDI that ensures the improvement of human capital quality. On the other hand, the education policies should focus on a better connection of the human resources to the requirements of the labour market and to offer acknowledge and practice that will help the graduates to correspond to the expectations of foreign investors.

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Human Capital Formation and Foreign Direct Investment in Developing Countries

SSRN Electronic Journal ◽

10.2139/ssrn.668505 ◽

2003 ◽

Cited By ~ 14

Author(s):

Koji Miyamoto

Keyword(s):

Developing Countries ◽

Human Capital ◽

Foreign Direct Investment ◽

Direct Investment ◽

Capital Formation ◽

Human Capital Formation

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Impact of foreign direct investment on economic growth in Africa

Problems and Perspectives in Management ◽

10.21511/ppm.14(2-2).2016.04 ◽

2016 ◽

Vol 14 (2) ◽

pp. 289-297 ◽

Cited By ~ 3

Author(s):

Olawumi D. Awolusi ◽

Olufemi P. Adeyeye

Keyword(s):

Economic Growth ◽

South Africa ◽

Human Capital ◽

Foreign Direct Investment ◽

Technology Transfer ◽

Direct Investment ◽

Central African Republic ◽

Capital Formation ◽

International Technology Transfer ◽

African Countries

Several studies have been conducted to examine the influence of foreign direct investment (FDI) inflow on economic growth. Indeed, the overall evidence is best characterized as mixed. This paper investigates the effect of FDI on economic growth in some randomly selected African economies from 1980 to 2013, using a modified growth model by Agrawal and Khan (2011). This model consists of Gross Domestic Product, Human Capital, International Technology Transfer, Labor Force, FDI and Gross Capital Formation (GCF). Ordinary least squares and generalized method of moments were used as the estimation techniques. Of all the results, only Gross Capital Formation, Human Capital, and International Technology Transfer in the Central African Republic were found not to have any statistically significant influence on economic growth. In general, the impact of FDI on economic growth in African countries is limited or negligible. Consequently, this study observes that a 1% increase in FDI would result in a 0.12% increase in GDP for South Africa, a 0.05% increase in Egypt, a 0.03% increase in Nigeria, a 0.02% increase in Kenya, and a 1% increase in GDP in the Central African Republic. The findings also reveal that South Africa’s growth is more affected by FDI than the other four countries. The study also provides possible reasons behind South Africa’s great show of FDI and the lessons other African countries could learn from South Africa better utilization of FDI. This study integrates the related drivers of the effectiveness and success of FDI

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Individualism, Human Capital Formation, and Labor Market Success

SSRN Electronic Journal ◽

10.2139/ssrn.3957705 ◽

2021 ◽

Author(s):

Katharina Hartinger ◽

Sven Resnjanskij ◽

Jens Ruhose ◽

Simon Wiederhold

Keyword(s):

Human Capital ◽

Labor Market ◽

Capital Formation ◽

Human Capital Formation ◽

Labor Market Success ◽

Market Success

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Analysis of Foreign Direct Investment and Economic Growth in Nigeria: Application of Spatial Econometrics and Fully Modified Ordinary Least Square (FMOLS)

Foreign Trade Review ◽

10.1177/0015732519851631 ◽

2019 ◽

Vol 54 (3) ◽

pp. 159-176 ◽

Cited By ~ 1

Author(s):

Olabode Philip Olofin ◽

Oluwole Oladipo Aiyegbusi ◽

Abayomi Ayinla Adebayo

Keyword(s):

Economic Growth ◽

Human Capital ◽

Foreign Direct Investment ◽

Direct Investment ◽

Capital Formation ◽

Least Square ◽

Income Growth ◽

Tax Revenue ◽

Ordinary Least Square ◽

Determinants Of Fdi

Based on the controversy surrounding the determinants of foreign direct investment (FDI) inflow from one country to another and the suggestion that inflow of FDI might be a result of countries’ locations, this study therefore revisits the determinants of FDI and economic growth by testing for the roles of country’s location in the determination of the inflow of FDI to Nigeria. Unlike other studies, this study finds that countries’ locations do not play any significant role in determining FDI inflow to Nigeria. The study, therefore, employs fully modified ordinary least square (FMOLS) to examine the determinants of FDI in Nigeria. The FMOLS results show that FDI, manufacturing sector, tax revenue, financial development, health expenditure, net trade and human capital have a positive relationship with income growth. These results were statistically significant except for tax revenue, net trade and human capital. These results support the argument that these variables are important determinants of economic growth. The article also finds a negative and statistically significant relationship among FDI, income growth, import and capital formation. These results are in conformity with economic theory in the sense that import of goods and services constitutes a leakage in the economy. Negative impact of capital formation and security could be associated with the prevailing high level of corruption, sharing of security votes and misappropriation of funds among the public officials in Nigeria. JEL Codes: F23, F26, F21, H24

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