Late-development Advantage Of Human Resource

The increasing imbalance between rich and poor countries determine development gap among countries. One view emphasizes the international context of development. We saw that poorer countries have important advantages that the first pioneers along the path of industrialization did not. Developing nations can now draw upon the capital, skills and technology of more advanced countries. A hypothesis advanced by Alexander Gerschenkron of Harvard suggests that relative backwardness itself may aid development. Countries can buy modern textile machinery, efficient pumps, miracle seeds, chemical fertilizers and medical supplies. Because they can learn on the technology of advanced countries, today's developing countries can grow more rapidly than did Britain or west Europe in the period 1780-1850. As low-income countries draw upon the more productive technologies of the leaders, we could expect to see convergence of countries towards the technological frontier. Convergence occurs when those countries or regions that have initial low incomes tend to grow more rapidly than those with high incomes. Research on late-development involves late-development advantage of capital formation, human resource, technology, institution and structure. People always pay more attention to late-development advantage of capital formation, or technology in real world.In terms of human resources, one view highlights rapid population growth, poverty and undernutrition, low productivity, low level of schooling in developing countries. Put differently, Theodore Schultz developed investment in human resource for developing countries in 1961. World development report 2005 address a better investment climate for everyone. Much as more people interested in the development of a poor country will monitor economic growth and catching-up, so this dissertation keeps a careful watch on catch-up by exerting late -development advantage of human resource for developing countries.The present doctorate dissertation totally compromises five chapters. Chapter 1 goes to theories of late-development advantage, especially late-development of human resource, which argues relative backwardness itself may create learning opportunities for less developed countries. Concretely, differences in laborwage rate, labor productivity, health and nutrition, and average education level between poor and rich countries promote developing countries to use plentiful human resource to increase total national product; Diffusion and spillover of advanced knowledge in developed countries have facilitated availability of advanced knowledge for developing countries. Advanced knowledge help to foster skilled labor, which zoom ahead increase in labor productivity, thereby maximize output, holding other inputs constant.Chapter 2 comes to research on late-development advantage in quantity of human resource. This chapter begins with a survey of late-development disadvantage for developing countries, involving rapid population growth, more the poor, low level of schooling, low productivity, unfavorable international competitive position. Late-development disadvantage has almost become a popular cliche in the literature on world development, but without much discussion of the precise magnitude of the late-development advantage facing the developing countries if the per capita income gap between rich and poor nations is to be narrowed. In fact, relative disadvantage may turn to relative advantage under certain condition. For example, everyone knows that unskilled or low-skilled labor, low labor productivity is disadvantage of human resource, but conversely, the labor with the low-skilled and low productivity usually mean low wage, which lower production costs, thereby making final products competitive, for instance, low price goods contribute to export. Rapid population growth also bring abundant labor, which enable developing countries to develop more consumption industries and labor-intensive industries. If poor countries simply developed labor-intensive industries by using a number of low wage labor may widen development gap between poor and rich countries, and fall into trap of late-development advantage.Chapter 3 turns to research on late-development advantage in quality of human resource, which means it is easier for developing countries to get advanced knowledge, management experience in the world. Availability of knowledge enables people in developing countries to promote improvement of quality of human resource (human capital), maximizing gross domestic products. Human capital gap between rich and poor countries is a sound reason that late-development advantage of human resource in developing countries can be carried out. Gap in quality of human resource between rich and poor countries make it possible for people in developing countries to catch up level ofeducation, and capacity of absorbing capital and technology in developed countries. This chapter starts with gap in quality of human resource between rich and poor countries, then turns to routine (approaches) to carry out late-development advantage of human capital, involving foreign direct investment, study abroad, international communication and cooperation. Training for labor in developing countries enable the labor to absorb rapidly advanced knowledge, master production technology, and improve increase in production capacity. Studying abroad make the young in developing countries to get easily advanced knowledge in industrialized countries. Return immigrants not only bring back new idea, new technology and new knowledge, also take back better approach of thinking, which promote directly increase in quality of human resource. Active international communication and cooperation may make more people absorb new knowledge with shorter time and lower cost of investment in education.Chapter 4 is concerned for return to late-development advantage of human resource, which includes return to investment in education, rate of contribution to economic growth. Returns to investment in education based on human capital theory have been estimated since the late 1950s. In the 40-plus year history of estimates of returns to investment in education, there have been several reviews of the empirical results in attempts to establish patterns. Many more estimates from a wide variety of countries, including over time evidence, and estimates based on new econometric techniques, reaffirm the importance of human capital theory. This chapter reviews and presents the latest estimates and patterns as found in the literature at the turn of the century. The latest return estimates reconfirm that rate of return to investment in education in low-income nations is higher than the middle- income nations, which higher than the high-income nations.The extremely high growth rates of real GDP for the four East Asian countries reflect remarkably high contributions from the growth of capital and labor inputs, not extraordinary improvements in total factor productivity. The maintenance of a high growth rate of real GDP for Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States for the period 1947-1973, 1960-1990, relied on a remarkably high contribution from the growth of capital input and total factor productivity. That is to say, economies with abundant human resource tend to develop labor-intensive industry, reflecting exertion of late-development advantage of human resource.Chapter 5 keeps a closely watch on policy of late-development advantage of human resource. Government must foster a skilled and healthy workforce that can contribute to a productive and prosperous society. Improving the investment climate goes hand in hand with enhancing human capital. A skilled workforce is essential for firms to adopt new and more productive technologies, and a better investment climate raises the returns to investing in education. Governments need to take the lead in making education more inclusive and relevant to the skill needs of firms, and create a sound investment climate for providers of education and training services. Government should help workers cope with change in a more dynamic economy. Inadequate mechanisms to help workers cope with change restrict entrepreneurship and the adaptability of workers. Government for developing countries should gradually raise the threshold of entry of foreign appropriate technology, which contributes to learning advanced technology.The links between education, health, and growth can create virtuous circles: good education and health enable growth, which in turn promotes further investment in them. The circles can also be vicious: poor education and health reduce incentives for productive investment and entrepreneurship, which limits the resources for enhancing education and health. Government also should promote study abroad, and build up institution that return immigrants work in homeland.