The Headquarters Economic Development And The Introduction Of Fdi In China

With the rapid development of globalization, MNC is pushing forward with its Headquarter's transfer. In the past, MNC recombined or transferred its branch in order to keep stabilization in the whole world; today, at the very point to search for competition advantage, MNC tend to reprogramme the HQ's setting, for instance, to establish regional HQ, reset the function or even transfer its global HQ. Under such circumstances, HQ economy, who serves as a new economic conception, is on fast development in the past decade.The transfer to HQ as well as the HQ economy has brought many new chances to some countries. Regions and countries including Hongkong and Singapore have already benefited a lot from it. Also, this transfer has brought many tangible and intangible benefits. First, it could be the affirmation to the investment environment in the region or country, which would result in higher GDP and tax revenue; second, it could offer more senior administrative positions to local employees, as well as management knowledge and experiences needed for high-level decisions; furthermore, if MNC mean to transfers its R&D to the regional HQ, it would promote greatly the science and technology standard in the host countries as a result of technique overflow.So far, HQ economy has already fully exhibited its power on economic development, technological innovation, more job opportunities, higher tax revenue and so on. Besides, it has won a global attention and favor. With the increase competition in introduction of the foreign investment, some certain countries especially those who lack of natural resources or have some territorial restrictions, are all endeavoring to attract the HQ's establishment in order to drive the economy.In China, it is Zhao Hong who firstly put forward the conception of HQ economy; besides, he made a thorough research on its background, actuality, characteristics, existent problem and so forth. Meanwhile, he always sparkplugs the development of the HQ economy. Then it came with some different opinions from some scholars. On the basis of related literature as well as investigation, this dissertation made a definition on HQ economy as follows: attracting by some particular advantage in certain regions, some headquarters made a high reputation by centralization and also promote these regions'development, as a economic form, this aggregation could be called HQ. Regarding to its appearance in China, should be analyzed under a backdrop of globalization, the development of information technology, the deepening in China's market system, which owning to a profound reform between regional resources diversion and the change in the structure of a enterprise caused by the disparity among regional resources.From a global view, all MNC headquarters sits in major metropolises around the world. In China, the phenomenon of that MNC moves its headquarters to Shanghai and Beijing happens almost every month, even some middle sized cities have developed a certain scale on HQ economy. It appears to be a trend that headquarters are moving together into center cities while the manufacturing in these center cities are moving outward. HQ economy has become a new model for using the foreign capital, and in correspondence to this model, many regions take the development of HQ economy as their development strategies.Under the backdrop of globalization and regional integration, the development of HQ economy could exert important effect on our economic pattern, and bring new energy and chances to our regional economy and enterprises. The rapid development of HQ economy has already drawn the government's focus and became a new growth point for the growth. Since the year 2002, many governments take the development of HQ economy as their stratagem, such as the stimulate policy made by Beijing, Shanghai, Guangzhou, Shenzhen in order to attract the MNC's headquarters.Nowadays, the inflow of FDI in China has slowdown. Problems such as how to increase the attraction for high-add value, how to attract HQ so that to attract high quality investment, how to hold the processing of HQ's development are closely related to the development of regions and enterprises. That is just why these problems should be considered thoroughly. For example: the inevitability of the HQ economy; the impact it would bring to us on our economic theory as well as innovation; whether it could be a good facet for our FDI or otherwise be a reason for the disparity among regions; the relativity between regional stimulant policy and the setting of HQ, etc. Because the research on"HQ economy"has not fully developed, especially those research which connect HQ economy and FDI. Though this discourse, the author want to made a useful attempt in this facet.According to the analysis on the actuality of MNCs and their headquarters, this dissertation is to put forward the definition of HQ, and discuss its purpose, facilities and the effect of FDI introduction on regions or countries. The focus goes on the correlation between stimulate policy and MNC investment policy. Based on the analysis on form of HQ and the factors which could affect the HQ's setting, this dissertation also construct a game model to show the effect of such government stimulative policies would bring in order to attract HQ resources. After analyzing the tactic adjustment of MNC and its trend of development, this dissertation takes Beijing, Shanghai as examples which would indicate the characteristic HQ economy has already formed in China, especially the impact of HQ and FDI on our economy. From a historic standpoint, this dissertation discusses the trace of China's policies for foreign investment and centers on the stimulate policy and the characteristics Chinese government is implementing now on the MNC and its headquarters. The last part comes with some forecasts and obstacle analysis for the development of HQ in China, as well as some suggestions that would be followed by the progress of HQ economy.