RIEB Discussion Paper Series No.2019-17

Title

International Talent Inflow and R&D Investment: Firm-level Evidence from China

Abstract

Using firm-level R&D data with regional international talent data, we find that international talent increases the R&D investment of Chinese manufacturing firms, a result that is further confirmed with patent data and under a number of robustness checks. These findings stem from two mechanisms: international talent boosts human capital accumulation and provides a diversified labor force. Further, the R&D promoting effect is stronger if firms are located in eastern China rather than in other regions, of small and medium-sized rather than large-sized, of domestic ownership rather than foreign ownership. The policy implication is, the introduction of international talent can be a new way to promoting R&D investment, especially for skilled-labor constrained countries.

Keywords

International talent inflow, Manufacturing firms, R&D, Patent application

JEL Classification

F16, F22, O32

Inquiries

Hao WEI
Department of International Economics, Beijing Normal University

Ran YUAN
Department of International Economics, Beijing Normal University

Laixun ZHAO
Research Institute for Economics and Business Administration,
Kobe University
Rokkodai-cho, Nada-ku, Kobe
657-8501 Japan
Phone: +81-78-803-7036
FAX: +81-78-803-7059