An empirical study on relationship between China's human capital level and FDI technology spillover: 1985–2009

The inspection results of VECM model being aimed at China's human capital level and FDI technology spillover from 1985 to 2009 show that there is a long-term stable relationship between them. However, the short-term relationship between them is not significant. From the dynamic perspective, the change of FDI technology spillover induces evidently positive effect on human capital level in China, while the effect of change of China's human capital on FDI technology spillover is relatively weak. Further analysis shows that FDI voluntary technology spillover promotes level of China's human capital, the overall low level and the less increment of human capital could not accelerate FDI compulsory technology spillover in which the weak influence of human capital on FDI technology spillover is revealed. Based on the above analysis, recommendations are put forward that the policy involved FDI introduction should lean on potential FDI which has more possibility of technology spillover, and secondary education input should be continuously reinforced.