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Rural human capital investment’s driving effects to labor migration - An empirical study based on Vector Error Correction Model

Author

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  • Zhong, Shihu
  • Juan, Tang

Abstract

Based on vector error correction model, this essay aims to test the relationship between the rural human capital investment and labor migration by using the data of Hunan province from 1994 to 2014. Experiment results show the long-term balanced relationship between rural human capital investment and labor migration. Rural human capital investment can boost the transfer of labor force effectively in the long run. While none obvious effect would take in a short time. There is time lag effect on human capital investment. The time needed to amend the cointegration relationship would be long and the primary factor that affects the labor migration is the prophase investment of human capital.

Suggested Citation

  • Zhong, Shihu & Juan, Tang, 2016. "Rural human capital investment’s driving effects to labor migration - An empirical study based on Vector Error Correction Model," Business and Economic Horizons (BEH), Prague Development Center (PRADEC), vol. 12(4).
  • Handle: RePEc:ags:pdcbeh:264617
    DOI: 10.22004/ag.econ.264617
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    File URL: http://ageconsearch.umn.edu/record/264617/files/201703220211_12_BEH_Vol12_Issue4_2016_Zhong_and_Tang_JuanRural_human_capital_investment_driving_effects_labor_migration_verc_pp.164-172.pdf
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    References listed on IDEAS

    as
    1. Huffman, Wallace E., 2001. "Human capital: Education and agriculture," Handbook of Agricultural Economics, in: B. L. Gardner & G. C. Rausser (ed.),Handbook of Agricultural Economics, edition 1, volume 1, chapter 7, pages 333-381, Elsevier.
    2. Dwayne Benjamin & Loren Brandt & Paul Glewwe & Li Guo, 2000. "Markets, Human Capital, and Inequality: Evidence from Rural China," William Davidson Institute Working Papers Series 298, William Davidson Institute at the University of Michigan.
    3. Becker, Gary, 2012. "Growing human capital investment in China compared to falling investment in the United States," Journal of Policy Modeling, Elsevier, vol. 34(4), pages 517-524.
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