An Empirical Study Of The Impact Of Idiosyncratic Human Capital On China’s Regional Economic Growth

1960s, American economist Schultz founded the Human Capital Theory whichopened up new theoretical ideas to study the relationship between human capital andeconomic growth of. The theory states that: human capital means that person’sknowledge, ability, health, etc. Its improvement is much more important thansubstance and increasing in the number of labor which makes contributions toeconomic growth. The modern human capital theory research has also directed tohuman capital on economic growth mechanism, and found that different types ofhuman capital have different mechanisms on economic growth. Since then, humancapital as an independent factor of production were included among the economicgrowth model. As a special human capital in the era of knowledge economy, the effectof the idiosyncratic human capital on economic growth has become increasinglyprominent.This paper which based on a whole idea of "ask questions-define questions–theoretical analysis-empirical analysis-summarize the discussion" has been analyzedtheoretically from the basic researches such as the definition, formation mechanism,measurement and so on of the idiosyncratic human capital. It studies three mechanismsand effects of the idiosyncratic human capital on economic growth mechanism. Andunder the joint mechanism, this paper establishes an empirical model of idiosyncratichuman capital which can characterize both the special human capital as direct inputfactors of economic growth and its impact on the final output as an indirect factorinputs through technological innovation influences of economic growth. The empiricalanalysis of the impact of the total amount of heterogeneous idiosyncratic human capitalon economic growth in China and the role of idiosyncratic human capital on regionaleconomic such as the eastern region, the central region and the western region ofeconomic growth situation have been studied. And further analyzes the causes ofregional differences in economic growth, and gives conclusions and policyrecommendations.The study found that idiosyncratic human capital is a kind of human capital whichhas the attribute of productivity increasing marginal returns and it’s mainly formed byway of education and learning by doing. Years of education by the traditional methodof measurement idiosyncratic human capital can’t fully characterize the marginalproductivity of increasing returns property, and this paper adds a new indicator- education index which is from the perspective of the cumulative effect of knowledgeprovides a new method to solve this problem. A comparative analysis of the empiricalresults obtained and summarized by total idiosyncratic human capital of the countryand different types of heterogeneous human capital in the eastern region, the centralregion and the western region have a significant impact on economic growth of thecountry and all regions. From a national perspective, idiosyncratic human capital isthrough technological innovation and the role of final output in China’s economicgrowth, and its role in technological innovation has shown great potential for economicgrowth. From a regional perspective, economic growth in the eastern region mainlydepends on the degree of higher education to promote the role of human capitalgenerated through technical innovation; the central region mainly rely on effectivecooperation in human capital and higher levels of capital and other factors by acting onthe final output economic growth; while the western region is the role of human capitalthrough education degree in human capital and the role of technological innovation inthe final output level of primary education, the dual role in economic growth. Theresults further show that the higher levels of education in human capital throughtechnological innovation impact on the economic growth of all regions are moresignificant, while the primary education level of human capital is significantly existinga certain degree in hindering technological innovation.Therefore, this paper suggests that the local government in the use of limitedresources to invest in education should make a reasonable allocation of resources to alllevels of education. Specifically, we must first continue to strengthen the level ofhuman capital investment in higher and secondary education of our country. Thesecondary education should be consolidated which based on the continued expansionof the scale, and the development of higher education should transfer from expandingthe scale to improve the quality. Secondly, we must guide the rational flow of humancapital and improve the efficiency of human capital. During the configuration processof human capital, we should focus on improving the level of higher education of thepopulation proportion of R&D department and increasing the level of secondaryeducation of the population proportion in the production sector of final products.Finally, by strengthening inter-regional cooperation and exchanges, building humancapital system environment, give full play to all levels of human capital spillover space,so as to promote mutual promotion and coordinated development of regional economy.