Abstract: Based on the WTO Tariff Database, China Industrial Business Performance Data, Customs Trade Database and World Bank's Investment Climate Survey Database, this paper conducts an empirical study of the impact of import competition on China's human capital investment by employing the tool variable least square method. The findings show that the import tariff has a significant negative impact on the education level and vocational training of enterprises' workers, and the import penetration rate has a significant positive impact on the education level and vocational training of enterprises' workers. This indicates that the import competition can expand the internal wage gap in China's enterprises as a whole, which is conducive to the human capital investment of enterprises'workers. At the same time, the correlation coefficient of the impact of intermediate import tariff on the improvement of enterprise workers' education level and vocational training is significantly positive, which indicates that the competition of intermediate product import narrows the internal wage gap in China's enterprises, therefore, it is not conducive to the human capital investment of enterprises' workers. The workers in the enterprises with higher capital-labor ratio, higher total profit, better operating conditions and economic benefits, and performance-based wage system are more inclined to invest in human capital.

Key words: import competition, human capital investment, income gap, education, training