Study Of The Economic Effects Of China's Export Processing Zones

The economic effects of Export Processing Zones(EPZs) on FDI influx, employment creation and net export have been tested in a lot of literatures and practices. This paper modifies the model of Mauricio Jenkins (2000) , and examines EPZs's contribution to the growth of GDP through the domestic linkage and technological spillover by using this model, which suggests EPZs' economic effects also reflect in domestic linkage, technological spillover and the improvement of industrial structure. Therefore, industrial structure, domestic linkage, technological spillover, FDI influx, employment as well as net exports can be used as indexes evaluating the comprehensive economic effects of EPZs. To explain the evaluating result, this paper builds a model about the factors influencing the economic effects of EPZs. This model suggests there were the four main factors influencing the economic effects of EPZs: the international environment, domestic conditions, locational conditions and the role of the state, among which the last one is most flexible. The building-up connections of the four factors are suitable to explain the results of judgment for the economic effect and national income. Then, the comparative analysis of the EPZs of Taiwan, South Korea and Philippines effectively supports this model.The evaluation results of the economic effects of Chinese EPZs are as follows: the east area is superior to both the west and central area. The main reasons lie in the difference in the infrastructure, industrial configuration, goals of government and the management innovation, and in the fierce competition between EPZs and its unsuitable policies. At last, aiming for the existent problem and present situation, this paper expounds some suggestions about the prospective developing routes and policies adjustment for Chinese EPZs.