Abstract
This paper lends both theoretical and empirical support to the notion of optimal foreign direct investment (FDI) levels. It does so by uncovering an inverted-U-shaped relationship between FDI and human capital formation. The optimality of a particular FDI inflow depends on the educational incentives induced by FDI on the local, heterogeneous population. Our estimates confirm the significance of a positive (linear) and a negative (non-linear) impact of FDI stocks on tertiary schooling, which are exclusively relevant in developing countries.
| Original language | English |
|---|---|
| Pages (from-to) | 691-705 |
| Number of pages | 15 |
| Journal | Journal of International Trade and Economic Development |
| Volume | 25 |
| Issue number | 5 |
| DOIs | |
| State | Published - 3 Jul 2016 |
| Externally published | Yes |
Bibliographical note
Publisher Copyright:© 2016, © 2015 Taylor & Francis.
UN SDGs
This output contributes to the following UN Sustainable Development Goals (SDGs)
-
SDG 8 Decent Work and Economic Growth -
SDG 17 Partnerships for the Goals
Keywords
- Foreign direct investment
- human capital
- information
- skilled labour
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