The Impact Of FDI On The Competitiveness Of Producer Services

Since FDI widely developed in the world, the relationship between FDI and economic development has been the focus of in the Economics. With the advent of service-oriented economy, the competitiveness of the service sector has becoming the crucial determinant of a country’s economic position in the international arena.Opening as the main form of FDI is a major channel for improving the competitiveness of a country’s service sector level. And producer services works as the binder between manufacturing and services, which plays a vital role in upgrading the industrial structure and integrating industrial chain of China to form the scale competitive advantage. And exploring the impact of FDI on the competitiveness of the producer services will be a guiding role in a new round producer services industry transferring and upgrading. However producer services is still belong to the new research field and the research about the impact of FDI on the competitiveness of producer services is very less. The study objects of this paper are producer services FDI, competitiveness of producer services, and focusing on how the production service FDI impact producer service competitiveness mechanisms and effects. Firstly,this paper introduces the definition of the relevant producer service and the theoretical analysis of FDI impacting the producer service competitiveness mechanism, then use the China’s 20 provinces’(autonomous regions) panel data from 2004 to 2012, use the system GMM(System GMM) Empirical method to estimate the impact of FDI on Chinese producer services competitiveness since China joined the WTO, and the results show that the FDI has a positive effect on producer services competitiveness,what ’ s more, the high human capital and better market system of eastern coastal area have a positive impact on improving the competitiveness of producer services, the Midwest and the market is still limited by the level of human capital "development threshold.". Finally, based on the theoretical and empirical researches, offering some recommendations about producer services attract FDI to promote and enhance the producer services competitiveness.