Human Capital Matters: China in Information Age

Abstract

After 1978, China’s opening up and reforms process and post-development are among the important issues that have been studied in recent years. Important institutions and organizations that shape politics around the world closely follow the developments in China and focus on the factors behind the Chinese success of becoming an economy giant. In this study, it is revealed that China’s development is not only based on cheap labour and the resulting of exports, but also on the quality human capital it has cultivated. One of the most important components of development in China is human capital. The main argument here is that Chinese development has become sustainable by breaking the vicious circle of ignorance. In the age of information, communication, and technology, neither development nor growth will be sustainable for countries that do not make complex production. At this point, China, while achieving its growth with the export of labour-intensive products thanks to the low-cost production at the beginning, has seriously supported the development of the country and increased its capacity with its human capital with high quality education abroad and in the country meantime. This article discusses the policies that enable China to develop its human capital, and the prominent factors in doing so. The capital-oriented mode of production of the 20th century has left its place to technology with the information age. In the development literature, an alternative development approach has been put forward through the analogy of Nurkse’s famous vicious circle of poverty and the vicious circle of ignorance in the information age.