The Impact Of The Stock Of Human Capital On The Economic Development In Different Areas In China

Since the reform and opening up,China's economy has developed rapidly and people's living standards have improved drastically.However,in recent years,China's economic development has been confronted with problems,like the disappearance of population dividend,the increasingly serious aging population and the widening regional development differences.How to promote sustained economic growth has been a problem that has been studied by the researchers in economic fields.The Endogenous human capital theory holds that human capital can continuously promote economic development.On the one hand,human capital is regarded as the direct input factor of the final product into the production function,which directly affects economic growth through the internal and external effects.On the other hand,human capital can promote the invention and creation of social knowledge and skills and accelerate the ability of a region to absorb and digest the more advanced technology from other area.The speed of technology absorption and diffusion makes new and better material capital play a greater role,thus enhancing the technological level of the whole society and promoting the growth of output.For the endogenous human capital theory,many scholars have carried out empirical tests based on the international data or China's empirical data,and many domestic and foreign scholars have also conducted relevant studies on whether human capital would have a significant effect on economic growth.This paper reviews the literatures and summarizes the mechanism of how human capital would have an impact on economic growth and introduces dynamic panel model.I collected several definitions of heterogeneous human capital in different literature,divided the human capital to several layers of demand,analyzed the representativeness and data availability of the indicators and therefore formed the synthesized human capital indicators of knowledge(education)and skill to construct human capital indicators.The collected provincial panel data of human capital indicators is from 1993 to 2015 and can be divided into eastern and central and western regions according to the regional division.The correlation between economic growth and physical capital,labor force quantity and human capital has been conducted.The empirical results show that:(1)the initial output level has a significant impact on regional development,considering the broad economic gap between economic growth in eastern and central and Western regions.The upgrading of industrial structure in the central and western regions is relatively lagged behind and cannot provide adequate and suitable job opportunities for high-quality labor force.From the perspective of learning by doing,this further slows down the accumulation of human capital and therefore reduces the level of human capital in the central and Western regions.In addition,the level of economic development will lead to insufficient educational funds and further development.Expanding the gap between the level of human capital in the central and western regions and the eastern part;(2)The contribution of capital to economic growth is remarkable,and the output elasticity of capital is more than 0.3,which confirms that under the background of long-term extensive economic growth mode in China,economic growth is driven by huge capital input;(3)The contribution of labor force to economic growth in the central and western regions is not significant during the time after the reform and opening up.A large number of labors in the central and western regions have flowed out to the eastern region and the loss of the employment population in this region has a negative impact on the economic growth of the central and Western regions.(4)The role of human capital in the economic growth of the eastern region is to promote the absorption and diffusion of foreign technology.After the reform and opening-up,the eastern region relies on policy dividends and geographical advantages to absorb much foreign advanced technology and management experience,which greatly improves regional productivity and strongly promotes economic development.On the other hand,with the development of education industry and the outflow of high-quality talents from the central and Western regions,the number of highly educated people in the eastern region is large and concentrated,and the stock of human capital is not only large but also excellent.Human capital is the necessary prerequisite for the absorption and diffusion of technology.The stock of human capital in the eastern region improves the absorption and diffusion of advanced technology from home and abroad.(5)The effect of human capital on the economic growth of the central and western regions is reflected in the improvement of labor efficiency.The results support the direct effect of human capital,that is,the direct input factor of human capital as the final product,directly affects the economic growth through internal and external effects.The absorption and transformation ability of advanced foreign technology in the central and western regions is not strong.there is not enough human capital stock in the central and Western regions.the human capital level in the central and western regions cannot meet the needs of the latest technological and economic development.