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Human capital, institutional quality and industrial upgrading: global insights from industrial data

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  • Yixiao Zhou

    (Curtin University)

Abstract

The tendency for human capital to accumulate and for institutional quality to improve as countries develop is well documented. This paper investigates the association of these changes with the evolution of industrial structure toward greater manufacturing sophistication. The empirical analysis is based on a newly constructed panel dataset for 15 industrial categories in 92 countries over the period 1970–2010. The results suggest that the extent to which increased tertiary human capital promotes industrial upgrading is contingent on the level of institutional quality, as measured by an index over size of government, legal structure, access to sound money, freedom to trade and market regulations. Institutional quality is found to be complementary to tertiary human capital in promoting the relative growth of advanced manufacturing.

Suggested Citation

  • Yixiao Zhou, 2018. "Human capital, institutional quality and industrial upgrading: global insights from industrial data," Economic Change and Restructuring, Springer, vol. 51(1), pages 1-27, February.
    • Handle: RePEc:kap:ecopln:v:51:y:2018:i:1:d:10.1007_s10644-016-9194-x
    DOI: 10.1007/s10644-016-9194-x
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    16. Haini, Hazwan & Wei Loon, Pang & Li Li, Pang, 2023. "Can export diversification promote export upgrading? Evidence from an oil-dependent economy," Resources Policy, Elsevier, vol. 80(C).
    17. Pleticha, Petr, 2021. "Who Benefits from Global Value Chain Participation? Does Functional Specialization Matter?," Structural Change and Economic Dynamics, Elsevier, vol. 58(C), pages 291-299.
    18. Xing Gao & Keyu Zhai & Yue Qiu & Mengqiu Cao & Meiling Wu, 2020. "Innovation Institution and Spatial Transfer of Energy Industry: The Case of Jiangsu Province, China," SAGE Open, , vol. 10(1), pages 21582440199, January.
    19. Koffi Délali Kpognon & Henri Atangana Ondoa & Mamadou Bah & Peter Asare-Nuamah, 2022. "Fostering Labour Productivity Growth for Productive and Decent Job Creation in Sub-Saharan African Countries: the Role of Institutional Quality," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 13(3), pages 1962-1992, September.
    20. KPOGNON, Koffi & BAH, Mamadou, 2019. "Does institutional quality contribute to increasing labour productivity in sub-Saharan Africa? An empirical analysis," MPRA Paper 98674, University Library of Munich, Germany.

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    More about this item

    Keywords

    Industrial upgrading; Human capital; Institutional quality; Cross-country panel data;
    All these keywords.

    JEL classification:

    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • O43 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Institutions and Growth

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