Study On The Impact Of Country Of Origin Effect On The Spatial Agglomeration Of Foreign Enterprises In Cities

Since reform and opening up,our use of foreign direct investment has experienced a number of stages from exploration to prosperity.Foreign direct investment has played an important role in promoting the development of Chinese foreign trade,raising the level of Chinese opening to the outside world,promoting the introduction of technology and the promotion and discovery of industrial structure,satisfying the demand of Chinese market,accelerating the upgrading of the residents’ consumption structure,promoting the upgrading of national economic structure and accelerating the transformation of our economic system.In2020,China’s actually utilized foreign investment reached US $173.48 billion,surpassing the US to become the world’s largest recipient of foreign investment.In the context of the continuous expansion of the scale of foreign capital,in recent years,China has been thinking about how to improve the quality of utilization of foreign capital and optimize the structure of domestic foreign capital.Therefore,it is particularly important to clarify the distribution structure of foreign direct investment in China and optimize and adjust the macro-economy by using the unique distribution characteristics of foreign capital.In view of this,this paper takes the spatial distribution of FDI enterprises as the entry point,and studies the country effect for the spatial distribution of FDI in cities is very necessary.This paper tries to answer the following questions: How do country factors affect the agglomeration and distribution of foreign-funded enterprises in Chinese cities? Is the spatial agglomeration of foreign companies from different sources and locations affected by the same degree of country factors? Is the influence of country factors on the spatial agglomeration of foreign-funded enterprises independent of industrial agglomeration? What are the internal transmission mechanisms of the influence of country factors on the agglomeration of foreign-funded enterprises? This paper uses the registered data of foreign direct investment enterprises in China between 1995 and 2015,the World Governance Index(WGI)database of Hofstede Cultural Dimension database,including more than 160 countries(regions)and 300 domestic cities,and calculates the minimum distance and number of foreign enterprises in different countries.The two-way fixed effect regression model is used to estimate the panel data of foreign-funded enterprises,and the influence of the same-country effect and the neighboring effect on the spatial agglomeration of foreign-funded enterprises in the inner city is explored respectively.Finally,the registered enterprise database of foreign-funded enterprises is matched with the database of industrial enterprises,and the internal transmission mechanism is verified.The results show that:(1)The spatial agglomeration of FDI enterprises in Chinese cities is indeed affected by country factors,and both the same-country effect and the neighboring country effect will affect the spatial agglomeration of FDI enterprises.(2)The sub-sample regression results show that the agglomeration of foreign-funded enterprises in the same country generally exists in all countries and cities.The phenomenon of neighboring agglomeration of foreign capital enterprises is more in the eastern cities,while the foreign capital from African and European countries does not have a significant tendency of neighboring agglomeration.(3)Through the follow-up robustness test,it is confirmed that the effect of country effect on the spatial agglomeration of foreign-funded enterprises in cities is independent of industrial agglomeration and development zone policies.(4)According to the mechanism test results,country factors affect the spatial distribution of foreign-funded enterprises in cities by meeting their information needs and promoting their information sharing.Finally,based on the empirical analysis,this paper puts forward the following suggestions: the establishment of corresponding social institutions,such as national and regional chambers of commerce and consulates,to enhance the exchange between FDI enterprises;Attracting specific language talents and opening specific routes to attract foreign investment accurately can also avoid the waste of related resources;In addition,preferential policies can be adopted according to the characteristics of local foreign investment distribution and local development plans,and investment attraction can be carried out with national park policies and other policies targeted at specific countries.