Human Capital And Fdi In Economic Development Of Interactive Study

Since 1960s-70s, high-technology industry, represented by computer and infomation technology, has been developing rapidly, which has changed the traditional model of production and growth. Propelled by the wave of technology progress and economic globlization, the world economy has grown rapidly and diverged greatly. Knowledge and technology innovation have become the original power to push economic growth. Under the condition of globlization, all the countries, to some extent, have to depend on the exotic technology and knowledge to develop. For developing countries, it is cheaper and more time-saving to strengthen endogenous technology ablity by introducing, absorbing and innovating the external technology than make R&D and accumulation by self. It is because of this that gives the undeveloped countries the so-called backward advantage.Today, multinational company (MNCs) becomes the main inventor, owner and user of advanced technology, and foreign direct investment (FDI) initiated by MNCs is a compound composed of capital, technology, knowledge and management, which is one of the most important carrier to transfer technology. In order to make use of FDI, developing countries have changed their development strategies from import substitution to export orientated, particularly, after the debt crisis during 1980s, almost all the countries have liberlized their investment and trade institutions to actively attract the FDI. There exists a presupposition behind the action, which supposes that inward FDI can introduce advanced technology, and the technology can spillover to the host country, therefore, help the host country to make technology progress.The actual effects of utilizing FDI, however, are not consistent with what developing countries have thought. Although every country has encouraged FDI inflow, the geographical distribution of FDI is extremely uneven. Not only has most of FDI clustered in developed countries, but even in developing countries FDI becomes increasingly aggregated. What is more important, the efficiency of utilizing...