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The Institutional Environment, Human Capital Development, and Productivity-Enhancing Factors: Evidence from ASEAN Countries

Published online by Cambridge University Press:  22 March 2023

Helery Tasane  and
Sopheak Srun
Helery Tasane*
Affiliation:
Tallinn University of Technology
Sopheak Srun
Affiliation:
Royal University of Law and Economics
*
*Corresponding author. E-mail: helery.tasane@taltech.ee
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Abstract

We explored the nexus between the quality of human capital, productivity-enhancing factors, and the quality of institutions in nine Association of Southeast Asian Nations (ASEAN) countries using canonical correlation and principal component analysis of country-level data for 2007–2017 from the World Bank, World Economic Forum, and Penn World Tables databases. We found that an unequal development of human capital in the ASEAN countries is clearly linked to their heterogeneous institutional conditions and that the quality of human capital drives technology absorption and innovation. The four transition economies in the region—Laos, Cambodia, Vietnam, and Myanmar—are facing particularly difficult challenges in developing institutional environments that stimulate human capital development to reach higher levels of knowledge intensity of their economies and achieve the resulting competitive advantages.

Keywords

institutionshuman capitalknowledgedevelopmentSoutheast Asia

JEL classification

O1: Economic Development O4: Economic Growth and Aggregate Productivity
Type
Original Article
Information
TRaNS: Trans-Regional and -National Studies of Southeast Asia , Volume 11 , Issue 2 , November 2023 , pp. 159 - 174
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Copyright
Copyright © The Author(s), 2023. Published by Cambridge University Press on behalf of Institute of East Asian Studies, Sogang University

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