Research On Impacts Of China's OFDI On Domestic Employment

Since entered into the WTO in 2001,China has adhered to the opening-door policy.The scale of domestic Outward Foreign Direct Investment(OFDI)grew rapidly.By the end of 2018,China's cumulative stock of OFDI reached $1982.27 billion,accounting for 6.4%of the global stock and ranking third in the world.Will the capital outflow and industrial hollowing-out generated by OFDI depress domestic employment? From a spatial perspective,both the stock of OFDI and the scale of employment are clustered in the eastern coastal areas,will OFDI have a spatial spillover impact on employment? So it is of great theoretical and practical significance to study the spatial spillover impact of OFDI on domestic employment from a spatial perspective.Based on the panel data of 30 provinces in China from 2003 to 2017,this paper combines theoretical and empirical analysis to explore the impacts of China's OFDI on domestic employment from a spatial perspective.Firstly,this paper makes clear the problem to be studied by studying the existing research.Secondly,it introduces the development trend of OFDI and employment in China from the perspective of the whole country and regional samples.Thirdly,it analyzes direct and indirect mechanisms of OFDI on employment from a spatial perspective.Fourthly,this paper calculates the Moran index of employment scale in China and draw the Moran scatter graph by constructing the spatial weight matrix.Next,it regress and test spatial econometric model by using Stata15.0.Then,it analyzes the direct and indirect impacts of OFDI on employment and compares regional differences.Finally,this paper summarizes the estimated results of the model,and then proposes a win-win plan to promote OFDI and employment.The empirical results show that,under the estimation of the spatial durbin model(SDM)China's OFDI has a substitution impact on the national employment,in which the local OFDI produces a significant negative spatial spillover impact on the employment in the surrounding areas greater than the promotion effect on local employment.The sub-sample regression analysis shows that the spatial spillover impact of OFDI on employment in China has significant spatial heterogeneity.In the eastern provinces,OFDI has a significant positive spatial spillover impact on employment.In the central and western provinces,the spatial spillover impact of OFDI on employment is not significant.In view of the above,this paper holds that to promote the co-development of OFDI and employment,the government should accelerate absorption reverse technology,establish anincentive mechanism for repatriation of investment profits,improve the ability to create new industries,train low-skilled workers,optimize the employment environment,strengthen regional interaction and so on.