A Study On The Effect Of FDI To The Manufacturing Industry TFP Growth Of Guangdong Province

With the development of economic globalization, the scale of capital flows betweencountries is increasing. For developing countries, attracting foreign investment can reparation thelack of funds in the process of economic development, and promote technological level ofdomestic enterprises. Academics from the early begin to pay close attention to FDI spillovereffect for the host country, as a big country of foreign capital inflows, we concern whether FDIimprove the technical level of China-related industries, and how it is implemented. In order totest whether FDI improve total factor productivity (TFP) of China’s manufacturing industry andhow it affects the TFP, this paper put the manufacturing industry of Guangdong province as theresearch object, and focus on industry and inter-industry spillover effect, then we analysis therelationship between the TFP and spillover effect.This paper uses data envelopment analysis (DEA) estimates the Mamlquist index ofGuangdong’s manufacturing from2000to2012, decomposing it into technological change andefficiency change. We analysis the spillover effect from the aspect of intra-industry, forwardlinkage and backward linkage. We also analysis how can industry characteristics include theextent of the technology gap, the degree of competition in the industry, market-oriented featuresand capital-intensive affect spillover effect. At the end we also give some policy suggestions.We draw the following conclusions: First, TFP of Guangdong’s manufacturing industry wasshown a steady and rapid growth trend during2000to2012, TFP growth rate of domesticmanufacturing is faster than foreign manufacturing; Second, horizontal spillover effect andbackward linkage promote the growth of domestic manufacturing TFP, the effect of forwardlinkage is not significant; Third, it is negative correlation between the technology gap andspillover effect, intense competition within the industry will promote spillover effect,domestic-oriented FDI would significantly contribute to the TFP growth of upstream industry,and in low capital-intensive industries, FDI promotes the TFP growth of downstream domesticmanufacturing.