The Impact of Education and Human Capital on High-Tech Business Upgrading: Macro-level Evidence

Abstract

In the contemporary digital economy, high-tech business upgrading is fundamentally constrained by the macroeconomic foundation of the national workforce. However, empirical studies often underestimate the impact of human capital, frequently yielding insignificant results. This study argues that such inconsistencies stem from methodological limitations, specifically the "inertia penalty," in which standard panel estimators over-penalize slow-moving structural variables, and the failure to account for cross-sectional dependence in global value chains. Using a comprehensive panel dataset covering 82 countries, this research examines the macro-level impact of education and human capital on high-tech business upgrading. To resolve the statistical puzzle, the study employs advanced econometric techniques—Feasible Generalized Least Squares (FGLS) and Fixed Effects with Driscoll-Kraay standard errors. The empirical results definitively confirm that when structural inertia and global interconnectedness are properly modeled, macro-level human capital is a powerful and highly significant driver of high-tech upgrading. Furthermore, the findings reveal that while human capital is a foundational driver, corporate research and development (R&D) serves as a critical parallel determinant for commercialization. This study contributes to the Macro-HRM and strategic management literature by proving the structural necessity of national education systems, while offering actionable insights for aligning public educational investments with corporate R&D incentives to foster industrial modernization.

Keywords: Macro-HRM; Human Capital; High-Tech Business Upgrading; Corporate R&D; Cross-Sectional Dependence; Driscoll-Kraay.

DOI: 10.7176/EJBM/18-6-04

Publication date: June 30^th 2026