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Rivers State University, Port Harcourt.
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| Title: | The Effect of Human Capital on Foreign Direct Investment Inflow In Nigeria: A Time Series Analysis |
| Author(s): | UGOCHUKWU Akunyili |
| Abstract: | The increasing attention given to the issue of “Human Capital and Foreign Direct Investment (FDI) and the appropriate policies needed for its effective utilization in a nation have given a renewed stimulus to research interest in the effect of Human Capital Development on Foreign Direct Investment in a nation. Hence, this research, therefore tests the effect of Human Capital Development (captured by Education and Health Expenditure) on FDI in Nigeria employing certain control variables such as financial efficiency, financial market dept, exchange rate, domestic investment, inflation rate, and household expenditure. This study was done with systematic econometric model which was estimated with the use of the Fully Modified Ordinary Least Squares (FMOLS) estimation technique using data from 1983 to 2018. From the results, the variables health expenditure, senior secondary school enrollment rate, financial market depth, and inflation rate were all significant at 5% whereas household consumption expenditure was only significant at 10%. However, other variables financial efficiency, exchange rate, and domestic investment were insignificant. The result of the estimation showed that the human capital proxies namely senior school enrollment and health expenditures both significantly increased the flow of FDI into the country. Generally, the results shows that human capital is important for the attraction of FDI into the country. Hence, government should prioritize investing in education and health as a matter of urgency. |
| Keywords: | Consumption, Efficiency, Market, Human Capital Development and Exchange Rate |
| Journal: | Economic and Social Science Review (ESR) |
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