| Since 1980s,China has attracted a large amount of foreign investment by virtue of its huge consumer market,abundant and relatively low-cost resource supply,increasingly perfect infrastructure and constantly improved service capacity.IIn 2014,China attracted $127.6 billion of FDI,surpassing the United States to become the country attracting the most FDI in the world.In recent years,the growth rate of FDI inflow in China has slowed down,but the actual utilization of FDI in 2017 still reached $131.035 billion,7.9%higher than that in 2016,indicating that China still has the potential to attract FDI.Meanwhile,we should also pay attention to the new situation and existing problems of FDI in China.From the external perspective,China is facing an important strategic opportunity of global industrial transfer and factor restructuring,as well as the competitive situation of southeast Asian countries’ efforts to attract FDI.Domestically,the distribution of FDI in the eastern and central regions is seriously uneven,showing the characteristics of more east less west and regional agglomeration,which is not conducive to the balanced development of regional economy.At the same time,the withdrawal of foreign investment happened in some eastern provinces.analyzing the geographical advantages of each region in the introduction of FDI,exploring how to make full use of the geographical advantages of each region in the new situation,enhancing the ability to attract FDI and improving the quality of FDI,which are the problems that this paper wants to s,olve.Based on the theory of new economic geography,combined with the theory of international investment and the traditional location theory,and after grasping the distribution status of FDI in China,this paper empirically studies the relevant factors affecting the choice of FDI location in China and their influence in different regions.Through statistical data,the total amount of FDI actually utilized in China from 2000 to 2017 was described,industry changes and geographical distribution were summarized,and the reasons were briefly analyzed.We discovered that under the dual influence of the international environment and the domestic environment,the actual amount of FDI used in China showed a fluctuating growth from 2000 to 2017,and the growth slowed down obviously after 2011.Among the four ways of utilization,foreign-funded enterprises are the main way,followed by joint ventures,but the proportion of both shows a small decline trend.The distribution structure of FDI in China’s industries tends to be balanced,and the rising proportion of service industry and high-tech industry breaks the dominant position of manufacturing industry.The uneven geographical distribution still exists,but the degree of agglomeration is reduced,and the central region shows the strength of attracting FDI.The empirical analysis used the panel data of 30 provinces in China(except Tibet autonomous region)which ranges from 2000 to 2017,and used the static panel instrumental variable method and dynamic panel GMM method to verify the impact of factors such as FDI self-accumulation effect,market potential,and transportation cost,technology spillover on FDI location selection.At the same time,time-division regression around 2008 was conducted to explore the long-term and short-term effects of factors influencing FDI location selection.Conducting regions sample regression to discuss whether there are differences in the influncing factors due to different regional endowments.The empirical result revealed that new economic geography factors have strong explanatory power in FDI location chioce.FDI follows the path dependence,tends to invest in places with large FDI stock,and there is an obvious agglomeration effect.The impact of labor cost on FDI inflow is significantly positive in the whole country and the western region,negative in the eastern region,and insignificant in the central region.Traditional factors such as preferential policies and foreign trade dependence still play a role.Innovation of this paper lies in:in the framework of new economic geography,by using the latest data at the provincial level and fixed effect panel instrumental variable method and the dynamic panel GMM method,verified the influence of the agglomeration effect,trade costs,market potential on attracting FDI.It also affirmed that technology spillover effect had a positive impact on China’s capital attraction at present.We also found that the traditional geographical element,the labor costs,played a different role in different areas which is in accordance with the regional characteristics of FDI in China at the present stage. |
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