The Influence of Human Capital Investment On the Exports of Services and Goods: An Analysis of the Top 25 Services Outsourcing Countries

Zusammenfassung

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With the rise of the global service economy, an understanding of the export competitiveness of nations is critical for managers seeking offshore export locations, and for government policy makers who wish to bolster the attractiveness of their nation as an exporting location. Services globalization calls into question the role of human capital investment, whose effect in past studies has been mixed. Drawing on human capital theory, this article developed three propositions and analyzed the effect of human capital investment, infrastructure, and the business environment on the export of services and goods from 25 countries from 1989 to 2003. Human capital did have a significant effect on the exports of goods and services. However, contrary to the expectations of human capital theory, human capital was not significantly more important for services exports than for goods exports. In line with expectations of human capital theory, human capital investment had a greater effect in emerging Asia than in developed countries.

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Auszug

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The Influence of Human Capital Investment On the Exports of Services and Goods: An Analysis of the Top 25 Services Outsourcing Countries

Introduction

In the manufacturing sector, technology and automation have been transferring low-skill factory jobs from developed countries to some emerging countries for well over a century. But until relatively recently, service sector jobs in developed nations were seen as less vulnerable to replacement by outsourcing. Advanced nation skilled workers in the service sector believed their education and skills would protect them from foreign competition. It was felt that most white collar jobs would be preserved because of investments in human capital, primarily through education.

The rise in the offshoring, or international outsourcing, from countries as diverse as the Czech Republic, Chile, and China, challenges this presumption. It reflects changes in the business environment, such as the spread of communications technology that have allowed easier and cheaper transmission of service exports, as well as an increase in the exports of manufactured goods. The incremental cost of transmitting the fruits of foreignmade production still remains somewhat of a distance barrier for manufactured goods (Venables 2006). However, in commercial services (ranging from software development, to customer call centers, to radiology, and medical transcription - to name just a few fastgrowing service export areas), the marginal cost of transmission tends towards a very low value1.

If "distance" becomes less relevant - in terms of the trans...

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