The Effects Of Environmental Regulations On FDI Location Selection

In recent years, foreign direct investment (FDI) ,with some hard facts that FDI has significantly increased its scale, upgraded its structure, and enhanced its capacities, has been giving great contributions to the economic growth in host countries. However, the influences of FDI and the spillover effects on host countries are not always positive, some negative effects, with some invisible features probably, would bring both economic and social risks. Environmental impact is one of these risks. More seriously, because of prior policies of economic development in many developing countries, low standard of environmental regulations, even "zero environmental regulation." in some places, lead to serious ecological and environmental damages in the process of FDI 's entry host countries. So, under this realistic background, an in-depth study on the environmental regulations and FDI has become an urgent task to be undertaken.On the base of theoretical researches of environmental regulations and FDI location, the thesis starts with practical relation between environmental regulations and FDI, establishes a model, and adopts an empirical study to reveal their correlation at both national and industrial level, then the thesis also discusses the mechanism of environmental regulations and FDI location choices. The objective of this research is to provide a theoretical base for the strategic adjustment of policies of FDI location choice in China, meanwhile it meets the needs of current construction of "recycling economy" and "conservation-oriented society".The thesis consists of six chapters:Chapter 1 introduces research subject, implications, main thoughts and approaches, and also makes a brief analytical summery to the previous studies in the research field of trade and environment. Chapter 2 analyzes the roots of environmental problems domestically and internationally, which highlights the environmental regulation theory, including the theoretical basis, type, contents and tools. Chapter 3 analyzes the FDI-related location theory, the impacts of FDI on the location choice of main factors. Chapter 4 is an empirical analysis part. Taking FDI and the expenditures on industrial pollution control as research variables, and using methods of time series analysis, the thesis provides a study on the effects of environmental regulation on FDI. Chapter 5, which is the most important chapter, emphasizes the impacts of two aspects of environmental regulations on FDI location choice, analyzes of environmental policy differences on FDI location choice, gives highly detailed analysis on the mechanism of the environmental regulations on FDI location choice at both the micro-enterprise level and the industry level, and comes to the implications in China. At last, Chapter 6 is a conclusion of the thesis.The main innovative work of this thesis are: Firstly, it tries to conduct some studies on an issue an emerging research field, the previous studies of FDI regulation and the environment are limited. Secondly, it adopts an empirical study by collecting a large number of data and a full-depth inspection; Thirdly, by using an analytical method, it studies the mechanism of environmental innovation FDI location choice of the impacts on China, which has a very strong practical significance.