The Study Of The Impact Of FDI On The IC Industry Market Structure In China

With the fast growth of global FDI, more and more studies on FDI appear. The impact of MNE's investment entry on home country's market structure becomes the one of frontfields. To a large extent, the impact of FDI in domestic market structure depends on choices of ways of FDI's entry. Different ways lead different impacts and benefit distribution between foreign and domestic companies.The IC industry in China has developed fastly in size and made big contribution and it is the core place in the process of industry shift. More and more MNEs enter IC industry in China in the way of greenfield investment and take full use of resourcing advantages. Under the condition of MNEs and domestic firms coexistence, domestic firms face the opportunities and challenges.The paper can be divided to the following main parts. Firstly, based on the knowledge from international investment, industrial economics and microeconomics I build a theoretical analysis framework on MNEs' choices of different entry ways by the collecting of previous literature. Second, I build a game model related to mechanism and strategy decision of MNEs entry and players are MNEs and domestic enterprises. Third, I make qualitative and quantitative on the impact of MNEs entry in Chinese IC market from perspectives of export, greenfield investment, average cost comparison between MNEs and domestic enterprises and conduction effect.The result shows that, MNEs conduct the market share pattern of global IC market into the Chinese IC market. In addition, MNEs will choose different entry ways according to characteristics and development stages from the perspectives of export and greenfield investment.