A Study On The Impact Of Smart City Piloton China’s FDI Quality

China’s economic development has experienced a stage of more than 40 years of rapid growth since the reform and opening-up.During this period,the economy has greatly developed and the quality of people’s life has improved.While keeping the speed of economic development,the 19th CPC National Congress report keeps line with realistic changes and needs,and timely puts forward the requirement of high-quality economic development.It is necessary to improve the quality of FDI in response to the changes in China’s realistic conditions.China has adopted a series of good foreign investment policies to attract large-scale foreign capital,but the effect of utilization is not obvious.Therefore,scholars began to divert attention from "quantity factors" to "quality factors",and they have studied the influencing factors of FDI quality from kinds of perspectives.Theoretically,when they studied it from the city level,they mostly started with the institutional and market environment of the city.Thus taking the smart city construction as the pilot policy into consideration can make up for the lack of research to some extent.From a practical point of view,studying the impact of smart city on the quality of FDI can help to find new factors that may affect the high-quality economic development.It provides new ideas for China to actively respond to the great changes that have not happened in a century.Firstly,this thesis reviews the existing research literature from five aspects.Then,it summarizes the theories that affect the quality of FDI,including resource-based view of multinational corporation and new growth theory.According to the previous domestic and foreign scholars’ research on smart city and FDI quality,this thesis summarizes the influence mechanism of the former on the latter.Then it talks about the status quo of smart city construction and the quality of FDI in China.On this basis,the author establishes a model of difference in difference to make the analysis by empirical method.As is shown in the result,based on the regression results of the whole sample,the construction of smart city pilot has no significant impact on the quality of FDI at the national level.To find out the reasons,the author divides the cities into three regions: eastern,central and western parts,and make regression analysis.The result shows that the impact of smart city pilot has a significant effect on the quality of FDI in eastern cities,but has no such impact on the central and western regions.This result is mainly caused by two reasons.Firstly,the development of human resources,technology and infrastructure of eastern cities in China are more mature,and the smart city construction policy is more inclined to eastern cities,and digital technology innovation enterprises gather there,so the eastern cities have stronger ability to absorb high-quality FDI.Secondly,the quality of FDI attracted by eastern cities is higher than that of central and western cities,and high-quality foreign capital can more easily absorb and utilize the effect of urban construction,so as to play a more obvious spillover effect.In order to explore whether this conclusion is robust,this paper then chooses the parallel trend test to verify whether there is a common development trend between the pilot city and the non-pilot area before the policy impact;Then it makes a placebo test to rule out the impact of other events.The results of both experiments indicate that smart city pilot has a significant effect on the FDI quality of eastern cities.We also found that smart city construction in the eastern region would improve the quality of FDI by improving local financial development.At the end of this paper,the author gives some targeted suggestions according to the conclusion.This thesis mainly contributes its innovation from two aspects.First of all,from a research point of view,previous scholars lack the research on the quality of FDI from the perspective of smart city pilot in the background of digital economy.The construction of smart city can greatly promote the development of digital economy and it is necessary to study the effect of smart city policy on the quality of regional FDI.This provides some writing space and possibility for this paper.Secondly,in terms of research methods,the previous literature rarely studies the impact of a pilot policy on the quality of FDI.This paper uses the exogenous policy of smart city pilot and the method of PSM-DID to compare the differences in the quality of foreign investment before and after the implementation of the differences between the cities hit by the policy and non-pilot cities,so as to investigate the effect of this policy on the quality of foreign investment.However,due to the difficulty of data acquisition of city level,this paper does not select more cities to expand the sample size for further analysis,which is slightly insufficient in the depth of research.