Uncovering the Relationship between FDI,Human Capital and Technological Progress in Chinese High-technology Industries

Using a panel dataset for 28 sub-industries from 5 Chinese industries from 1995 to 2006,this paper examines the impact of human capital, R&D expenditure and FDI spillover on theproductivity improvement of Chinese high-technology industries.The whole industry sampleresults suggest that human capital promotes total factor productivity, technical change andtechnical efficiency change, but that FDI lowers all ofthesefactors in Chinese high-technologyindustry.When we distinguish between types of ownership structure in the industries, wefind that human capital improves technical change but lowers technical efficiency change,whereas FDI only improves technical efficiency change in state-owned and state-controlledenterprises but reduces technical change in state-owned and state-controlled enterprisesand joint ventures.