| Since the opening to the world, especially the entry to WTO, the open and integrated international environment promotes the development of the foreign direct investment and foreign trade, which drives the national economy running smoothly. In view of the constraints of natural environment, geographical position and oriented policies, foreign direct investment and foreign trade have substantial but differential contribution on regional economy progress and different combination of both factors will generate various development modes of the regional economy. It is of great importance to investigate the impacts of both factors upon the development of regional economy.This paper is divided into five parts as following.Section 1 introduces the significance of this research and reviews the literature associated with foreign direct investment, foreign trade and regional economy. The contents, ideas and innovations of this paper is also proposed based on the analysis of related literature.Section 2 redefines the research scopes of foreign direct investment, foreign trade and regional economy and then a few theoretical models associated with foreign trade and regional economy are surveyed.Section 3 analyzes the regional differences of the foreign direct investment, foreign trade and the development of regional economy. The reasons of unbalanced regional economy is addressed from the aspects of natural environment, oriented policies, etc, and then both the positive and negative influences of this unbalance on regional economy is studied in details.In Section 4, five regions including Hebei, Beijing, Zhejiang, Jilin, and Shanghai, are selected considering the impacting factors of foreign direct investment, foreign trade, regional economic level and natural environment, economic policies, etc, a variable coefficient panel data model is established based on the data from 1994 to 2014 to investigate the influences of foreign direct investment and foreign trade upon the regional economy. It shows that foreign direct investment and foreign trade balance have active influences on the regional economy. However, both factors exhibit different impact modes because of the regional differentiation.In Section 5 based on the analysis of the panel data model, some suggestions are put forward from three aspects to boost the development of regional economy, i.e., attracting foreign direct investment, increasing foreign trade balance and actively oriented policies. |
