Abstract
AbstractUsing firm‐level panel data covering 2005–2007, the present paper examines the effects of R&D and human capital investment on productivity in China's electronics industry. It is found that both R&D and on‐the‐job training positively contribute to total factor productivity (TFP). Firms' investment in employees' health insurance and pensions, which are components of workers' compensation, generate a productivity‐enhancing effect, supporting the efficiency wage hypothesis. The estimated impact of R&D on productivity varies among different forms of ownership, and foreign‐owned enterprises experience higher R&D efficiency than state or private enterprises. After controlling for potential endogenous causality between TFP and R&D, the above findings remain unchanged. We also find that on‐the‐job training can improve the quality of human capital and is helpful in promoting productivity. Therefore, establishing indigenous technological capability through various technological sources is quite important, and the government should devote further effort to investing in human capital.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
