Abstract: This paper combines provincial data of international talent inflow and micro-data from Chinese manufacturing firms, to empirically study the impact of the international talent inflow on R&D investment of manufacturing firms in China. Empirical results show that the international talent inflow can significantly promote the R&D investment increase of Chinese enterprises. However, this effect varies based on regional differences and firms' heterogeneity. The results obtained for both robustness checks and endogenous treatment are robust. The Chinese government should therefore attach significant importance to the issue of international talent. More open policies and barrier-reducing initiatives should be implemented with the objective of broadening the scale of international talent inflow. Only in this way will China be able to make full use of the R&D promoting effect of the international talent inflow, thus accelerating the economic transformation towards high-quality development.
