The Research Of Spatial Technology Spillover Effect Of FDI

As the accelerative pace of China's integration to global economy is exciting the world, China's FDI stands the pace, thanks to the wisdom in the policy of opening. Specially in the recent decade, the amount of China's FDI takes the lead in the world. The introduction of FDI to China simultaneously brings vanguard technology. The effect of technology spillover in turn becomes an aspiring impellent to our domestic firms with respect to technology advancement, human resources development and innovation capacity. In some FDI-incentive region, there has formed the effect of spatial technology spillover, which greatly propels the national economy as well as regional economy.There is much research on the effect of FDI of technology spillover, undertaken or undertaking, domestic or overseas. But little gives attention to the correlation and mutual influence of neighbouring regions. In this thesis, the FDI effect of spatial technology spillover in is studied, based on the analysis of FDI effect of technology spillover and the industrial investigation in Jiangsu, Zhejiang and Shanghai.The trail of reasoning of this thesis can be summarized as follows. First, research is conducted on the fundamental theories and relevant mechanism of FDI effect of technology spillover. Basic analysis is also given on the FDI effect of spatial technology spillover with respect to its origination, application, spatial effect, quantitative modeling, model estimation and test methodology. Consequently, based on the fact that FDI does improve China's technology and that the effect of technology spillover does exist, an empirical study on the FDI effect of technology spillover and spatial technology spillover in the three neighbouring region is further conducted with use of econometrics methodology. Given determined factors such as capital, labour, fixed assets cost and output of foreign invested industries, the FDI effect of technology spillover in these regions are computed and validated. Adding the spatial weight factor by integrating the output of the regions to the explanatory variables confines, the spatial effect within the three regions'industry can be derived. As the quantitative result in the model, Shanghai, Jiangsu and Zhejiang displays differed FDI effect of spatial technology spillover. After analyzing this result, conclusion is made that FDI benefits the three regions industry growth. And finally some political suggestions pertain to FDI are tentatively discussed.