The Empirical Research On Thetechnology Spillover Effect Of FDI In Liaoning Province

With the upsurge of economic globalization, many countries especially developing countries have encouraged or stimulated foreign investors to invest. Generally, the foreign direct investment (FDI) cannot only improve the capital stock of host country by driving the unilateral transfer of money capital. At the same time, thanks to the FDI technology spillover effect, the local enterprises can promote the level of technology and management, thereby improving their production efficiency eventually.As the forefront of reform and opening up and an important member of Northeast China old industrial base, the manufacturing industry in Liaoning province is more developed than other provinces, with a good industrial foundation and ability to absorb the international industrial transfer. Manufacturing industry is the main flow of foreign direct investment in Liaoning province, In this paper, we focus on the manufacturing industry in Liaoning to study the FDI technology spillover effect. Combining with the actual use of foreign capital, this paper put forward the corresponding countermeasure and suggestion to promote the FDI technology spillover effect through the relevant theoretical analysis and the panel data analysis. It is very crucial for Liaoning province to promote the FDI technology spillover effect and use the FDI in a more efficient and healthy way in the future.The main task of this paper is to answer three questions:first of all, whether the FDI has technology spillover effect on the development of the manufacturing industry in Liaoning province? Second, whether the FDI technology spillover effect on the manufacturing industry in Liaoning province exist short-term or long-term effect? Third, analyze the FDI technology spillover effect on the manufacturing industry in Liaoning province based on industry-level factors.This paper contains five parts.The first part is the introduction, including the background and significance of this research, method and framework, and the innovations and shortcomings.The second part is theoretical research, including the definition of FDI and technology spillover effect, domestic and abroad literature review, the approach and influence of technology spillover effect. This theoretical research is the theoretical basis for the following empirical analysis.The third part is status analysis. First, this part introduces the development history of absorbing FDI in Liaoning province. Second, introduce the status and characteristics of utilizing FDI in Liaoning province. At last, analyze the advantages and conditions for Liaoning province to use the foreign investment.The forth part is the empirical analysis. This paper built an empirical model based on the present researches and methods, using the data of28manufacturing sub-industries in Liaoning province from2001to2011. Though panel data model analysis, we first study the FDI technology spillover effect and then we study the long-term effect by lagging one-stage period and lagging two-stage period of the FDI data. The empirical results show that the FDI has significant and positive spillover effect on manufacturing industry in Liaoning province. And it also has significant and positive long-term effect. And then, we choose industrial characteristics (for instance, technology gap, competition and industry gathering) as group indicators to analysis the further impacts of FDI technology spillover effect.The fifth part is countermeasures and advices. This part mainly offers three advices for Liaoning province after status analysis and empirical analysis, including setting up reasonable industry policy, enhancing the technology absorptive capacity of the local enterprises in Liaoning province,promoting the development of industrial clusters, and raising the management level of government utilization of foreign capital.One of the innovations of this paper is that it considers the manufacturing industry in Liaoning province as the research object. It built an empirical model to test the relationship between FDI and the output of domestic enterprises. Another innovation of this paper is considering the time-lag problem. However, this paper still exist some shortcomings, for instance, the difficulty of collecting data and quantitative method we used. This paper only chooses some representative industries as the object. All these problems need to be discussed in the future.