Foreign Direct Investment And Technology Transfer

During the developing economy, foreign direct investment (FDD is not only a.great contribution to national economy such as forming capital, improving employment, adjusting balance of payments, but also an important way to transfer advanced technology. Especially FDI flow to China, which rose after reform and opening, began to increase rapidly. At first stage, the majority of FDI in China originated from elsewhere in developing Asia including Hong Kong, Macao and Taiwan. But since 1996 a growing portion of FDI flows has come from developed countries and 95% of enterprises in top 500 Multinational corporations (MNC) invested directly to China. This latter FDI has of a different character than FDI from developing Asian nations. Thus one consequence of a rising percentage of FDI from developed countries has been that overall the activities of foreign-invested enterprises in China have become somewhat more focused on the domestic market, and less on export market. These changes notwithstanding, there is little doubt that FDI has contributed significantly to Chinese economic development and Taking existent technology factors of MNCs, it transfers technologies from parent company to subsidiaries in China. The summary of each chapter is as follows:Chapter One: I make a brief introduction on the concept and fundamental theory of FDI and international transfer of technology, and to understand basic theory of every school of thought and meaning of technology transfer, which laid solid foundation for research work of this thesis.Chapter Two: The relationship between FDI and technology transfer is discussed. Li this chapter, firstly, briefly describe the concept of FDI and new direction to investigate the influence of FDI on economy of host countries; secondly, investigate the effect of FDI on international technology transfer and technical diffusion of host countries. Last, make macroscopic and microcosmic analyses on effect of FDI-led technology transfer.Chapter Three: Contributions of FDI in Chinese economic growth and technology development are analyzed. In more than twenty years, scale of foreign investment is continuously extending and economic status of foreign-invested enterprise is continually improved, which make great contribute to economic growth, industry structure adjustment, employment improvement and external trade development of China. Firstly, the situation of FDI to China and the influence of foreign investment on China are analyzed. Secondly, from the point of taking China as absorbing country of technology transfer, I discuss and analyze the influence of FDI on Chinese technology transfer mechanism.Chapter Four: In order to make empirical research on technology transfer of foreign invested enterprise, I investigated 39's foreign invested enterprises in Beijing Economic-Technological Development Area (BDA), analyzed the" motivation of technology transfer, way and meaning of technology transfer and present situation of technical diffusion by results of investigation, Here are main findings; (1) During technology transfer between foreign-invested enterprise in BDA and parent companies of foreign investment, most enterprises perform technology transfer through inner ways of enterprises and open ways. Methods of technology transfer from parent companies to subsidiaries in China are mainly in the form of introducing production equipments, sending down project instructions, utilizing document data or dispatching directly technologists to achieve technology transfer. (2) Technical levels transferred from parent companies of investing countries are higher than those of Chinese domestic competitive enterprises. Especially, some transnational companies directly introduce in-used and advanced technology of parent companies into subsidiaries in China. Particularly, technologies in pharmacy and information technology industry are more advanced than other manufacturing. (3 ) Most foreign invested enterprises are connected with domestic subcontractor, and this relationship enables foreign invested ente...