Analysis of the Impact of Human Capital Investment and Allocation on the Upgrade of Industrial Structure in Guangdong

Abstract

Industrial structure upgrade is a dynamic process of reallocating the factors of production. Human capital, as the most active factor of production, plays an important role in accelerating the upgrade of industrial structure. Taking Guangdong province as an example, this paper uses VAR model and structural deviation degree to examine the impact of human capital investment and allocation on the upgrade of industrial structure respectively. The VAR model result shows that the investment in human capital is the Granger cause of the upgrade of industrial structure, and the impulse response analysis proves that the improvement of human capital level has a long-term positive effect on the upgrade of industrial structure. According to the structural deviation degree, the current industrial distribution of human capital in Guangdong is very inefficient with a total deviation degree of 30%, leading to a talent shortage in the secondary and tertiary industry. Besides, the unbalanced spatial distribution of human capital has widened the disparity of industrial structure among different regions in Guangdong. Finally, this paper puts forward some policy recommendations to solve these problems.

Why Can Guangdong Province Be Located First in China Regarding the Birth Population and Total GDP? - Analysis Based on Social Structure Change

“…In China, the spatial, economic, and social restructuring of both urban and rural areas will affect the economic development and population growth of the region [6]. The policies of industrial transfer and labor transfer implemented in Guangdong Province have facilitated the transformation of the industrial structure of Guangdong Province and optimized the labor force structure [7]. The urban economic structure of Guangdong Province is based on industrialization, with manufacturing as the mainstay.…”