1.
Yu-cheng Lai
– Department Of Finance, Shih Chien University, Kaohsiung Campus, Taiwan
2.
Santanu Sarkar
– Department Of Finance, Shih Chien University, Kaohsiung Campus, Taiwan
Abstract
This study shows that educated labor
is an important factor for output spill
over and the sectors or firms in Taiwan
with higher percentage of educated
workforce have exerted a
greater pull on foreign investment,
whereas the local Taiwanese firms
with higher percentage of educated
workforce were unlikely to invest
abroad. It was found that initially both
foreign and domestic firms have reduced
their investments when government
introduced new legislations to
regulate working conditions and employment
practices in Taiwan. But
when the government continued introducing
more stringent labor standards,
the country witnessed an upsurge
in inflows of investment over a
period of time and the domestic firms
began investing abroad instead of
concentrating in the home country.
