Study On The Reverse Technological Spillover Of China’s OFDI

With the growth of economic globalization, the situation of international trade and international production changes quickly. In order to pursue the maximum interest, transnational corporations arrange production around the world. The development, design, produce, process, marketing and after-sales service of products are no longer limited in one country or one district, which leads to more traditional inter-industry and intra-industry division of labor gradually transform into the professional division of one process or one link of production, form the division of global value chain. China embedded into the global value chain at the advantage of labor and resources and obtained interest from the international division of labor. However, China is facing the challenge of being locked at the end of global value chain. How to improve the technology level and the ability of independent research and development of Chinese corporations? How to upgrade in global value chain or even to be a leader of global value chain? Outward foreign direct investment can be the way to upgrade in global value chain.The outward foreign direct investment of China sprung up in the reform and opening, and increasingly expanded with the boost of "going-out" policy. This paper explores how to unlock in the end of global value chain by outward foreign direct investment, based on the division of global value chain. This paper includes six chapters. The first chapter, an introduction, introduces the research background and the meaning of subject, reviews relative literature of the reverse technological spillover effect of outward foreign direct investment and the division of global value chain. Secondly, theoretical basis introduces the theories of global value chain and outward foreign direct investment and mechanism of the reverse technological spillover effect of outward foreign direct investment, providing theoretical support for this paper. Thirdly, calculate China’s status in the manufacturing sector. Based on TiVA database founded by WTO and OECD, and calculate GVC status index of manufacturing sector to make sure the current status and variation trend of the manufacturing sector. Fourthly, overview the development process of outward foreign direct investment, state the outward foreign direct investment stock, current flow, industrial distribution, regional distribution and investment allocation. The fifth chapter makes the empirical analysis of the reverse technological spillover effect of outward foreign direct investment. Based on the data of outward foreign direct investment, research and development and invention patents, this chapter verifies the parent country’s technical progress brought by outward foreign direct investment. At last, some feasible policy proposals have been put forward according to the current situation of outward foreign direct investment to expand the scale of outward foreign direct investment and then provide help for upgrading in global value chain.