Empirical Analysis Of Relationship Between Agricultural FDI And Agricultural Environmental Pollution In China

The relationship between FDI and host country's environment has been a major concern in the field of the foreign investment.China has allowed foreign investors to enter into agriculture since the 1970s.The main form of investment is FDI,whose gross scale shows an increasing trend.Capital input is the foundation for agricultural development.As the important source of capital,agricultural FDI is different from domestic capital in management theory,production mode,technology process,etc,which may influence China's development process of green agriculture to some extent.Recently,scholars at home and abroad did comprehensive research on the environmental effect of FDI,but almost from regional macro perspective or industry perspective.This paper will analyze the relationship between China's agricultural FDI and agricultural environmental pollution from meso-level so as to correctly understand and actively use it to promote agricultural sustainable development.The article,based on the theory of International Investment Theory,use qualitative and quantitative analysis methods to analyze the development characteristics of China's agricultural FDI,the relationship between agricultural FDI and use intensity of agricultural production materials,the influence of domestic and foreign capital on agricultural environment from the meso perspective.Some econometric methods such as cointegration analysis,impulse response function are used to analyze the time series data from 1996 to 2015,so as to compare the different influence of domestic capital and foreign capital on the agricultural pollutant emissions and pollution intensity.The main conclusions are as follows:(1)In China,the volume of agricultural FDI showed an increasing trend and sources of it became more diversified,including the USA,the Netherlands,the UK,etc,which have advanced cleaner production technology and rich scientific management experience.(2)The data from 1997 to 2014 showed that with the increasing of the actual use of agricultural FDI,the use intensity of agricultural production materials,such as pesticides and chemical fertilizers,was decreasing.There was a negative correlation between them.Empirical tests of the time series data from 1996 to 2015 showed that a 1%increase in foreign capital was associated with a 0.34%drop in agricultural pollution intensity.All these proved that agricultural FDI was benefit for reducing environmental cost of agriculture growth and lessening environmental pollution during the process of agricultural development.(3)Compared with domestic capital,a 1%increase in agricultural foreign capital would lead to less pollutant emissions and more significant reduction of agricultural pollution intensity.So agricultural foreign capital played a more active role in transformation of our agriculture toward green growth in recent 20 years.On the basis of the above analysis and the real situation of our nation,the paper suggested that we should selectively introduce foreign capital to strengthen the positive effect of agricultural FDI on environment,and improve institutional building to raise the development level of green agriculture.