An Analysis On The Locational Choice And Evolution Tendency Of Fdi In China

As foreign direct investment (FDI) activities become increasingly frequent, many researchers have paid attention to the locational choice of FDI. China is the largest country which attracted the most foreign direct investments than other developing country, and has been attention by the world capital market. Many scholars pay close attention to the locational choice and evolution tendency of FDI in China. As is well-known, locational distribution of foreign direct investment in China is unbalanced for a long time. Many researchers descript the FDI distribution by 3 regions:east, middle and west area. With the deepen opening and the process of international economic integration, discover the locational choice of FDI in China and its location evolution tendency is needed. It's good for promote the regional economic growth and the regional coordinated development.This study based on the data of FDI in China's 29 provinces from 1985 to 2009. And use them to represent the condition of FDI in China. Through the Moran's I index and local Moran's I index analysis, found recently FDI in China exists significant positive spatial autocorrelation. In order to further analysis of various regions FDI spatial correlation size, put forward Li Shantong's 8 regional division in divided China into eight analysis regions. According to analysis the four phases of FDI locational choice variation, found in different phases of various area space connection is not same. For instance, the eastern coastal areas and northern coastal area are in very strong space positive spatial autocorrelation from 2004 to 2009, and the northeast of China is in negative spatial autocorrelation.In order to find out the deciding factors, those affect the FDI location choice and the regional FDI spatial autocorrelation. Based on Dunning's location advantages theory, and learn form related researches, this analysis choose eight variables. Through the panel data model analysis, four stages of FDI location, selection decision factors, found FDI location choice mainly by the initial district level of opening and labor efficiency wages. While current FDI locational choice consider more about the investing regional market potential and industrial structure. Combining the analysis, the foreign direct investment may further tilt to north coastal area, the surrounding of eastern coastal areas will attract more FDI; The Southwest and the Yangtze River area may become to the next FDI agglomeration place. At the finality puts some advices about how to encourage and enhance FDI in China.