Abstract
This paper looks at both the theoretical and econometric support to the notion of optimal FDI levels. It does so by uncovering an inverted-U-shaped relationship between FDI and educational effort. The optimality of a particular FDI inflow depends on the educational incentives induced by FDI on the local, heterogeneous population. Those incentives are formed in the face of uncertainty and asymmetric information between the multinationals and their potential workers. Our estimates confirm the significance of a positive (linear) and a negative (non-linear) impact of FDI per capita on tertiary schooling, both in developed and developing countries.
| Translated title of the contribution | On the effects of foreign direct investment on local human capital formation |
|---|---|
| Original language | Spanish |
| Pages (from-to) | 153-161 |
| Number of pages | 9 |
| Journal | Cuadernos de Economia |
| Volume | 34 |
| Issue number | 96 |
| DOIs | |
| State | Published - Sep 2011 |
| Externally published | Yes |
UN SDGs
This output contributes to the following UN Sustainable Development Goals (SDGs)
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SDG 8 Decent Work and Economic Growth
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SDG 17 Partnerships for the Goals
Keywords
- Asymmetric information
- Foreign direct investment
- Human capital
- Skills
- Tournaments
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