Labor Skills and Foreign Investment in a Dynamic Economy: Estimating the Knowledge-Capital Model for Singapore
48 Pages Posted: 20 Apr 2016
Date Written: June 1, 2009
Singapore is an interesting example of how the pattern of foreign investment changes with economic development. The authors analyze inbound and outbound investment between Singapore and a sample of industrialized and developing countries over the period 1984-2003. They find that Singapore's two-way investment with industrialized nations has shifted into skill-seeking activities over the period, while Singapore's investments in developing countries have increased sharply and become concentrated in labor-seeking activities. Singapore's increasing skill abundance relative to all countries in the sample accounted for 41 percent of average inbound stocks during the period, that is, US$18 billion annually; the corresponding figure for outbound stocks was 40 percent, that is, US$5.51 billion annually.
Keywords: Debt Markets, Non Bank Financial Institutions, Investment and Investment Climate, Economic Theory & Research
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