The Influence Of Multinational Corporations On Technique Innovation In Developing Host Country

As an engine and a thruster of economic globalization, multinationalcorporations (MNCs) could impact systematically on developing countries andareas' society and economic. This paper set the aim and extension of study as a systemprocess about technology between MNCs which have technical monopoly advantageand local enterprises existing as the base of our country's economic development,and parsed the structural characters and linkage effects between MNCs' technologytransfer and spillover and local firms' technology innovation.In the beginning, this paper built a system analytical frame about the relationshipbetween MNCs and technology innovation in host country. The frame clarified theinfluence system of MNCs on economic growth of host country, the interactiverelationship of MNCs' technology innovation and domestic corporations' and it ofMNCs' spillovers and domestic corporations' absorption capability on the basis ofsystematical review on the researches performed by foreign and domestic scholarswhich focus on the relationship of MNCs and technology innovation, by takingtheories about international technology transfer, technology innovation andeconomic growth. Then, it analyzed the scale and structural characters of capitalwhich MNCs invest to Jiangsu province through searching a great deal of literatureand extensive profound investigation, and measured the contribution to economicgrowth of Jiangsu province by using distributed lag model. The analysis showed thatin short-term MNCs' entry can help to the improvement of technical level andinternational competitiveness of Jiangsu province in deed. After that, weimplemented a relational analysis between Jiangsu regional technology innovationand MNCs' investment by using regional innovation capability index, combiningwith factor analysis and rank correlation analysis. We found multinational FDIfacilitates the improvement of regional integral technology innovation capability. Wetested the impact of multinational spillover effects and compared the differences andreasons about spillover among Jiangsu, Beijing, Tianjin, and Liaoning, throughmultiple linear regression analysis with time series data, cross section data and paneldata of MNCs and all firms and local firms in Jiangsu province. At last, on the basisof innovation theory system and experimental data, we built primarily a systemdynamic model about the relation between multinational investment and Jiangsu localfirms' technology innovation. The model built a system about the relationshipbetween MNCs and local firms' technology innovation, which took multinationalinvestment sub-system and local firm technology progress sub-system as centre andtook national economic sub-system and government trade and investment policysub-system as support. The system simulated the impacts of MNCs on Jiangsu localfirms' technology innovation arid supplied the basis for management strategy, byincluding data and information of Jiangsu relevant impact factors.Supported by the conclusion of qualitative and quantitative analysis, weelaborated the strengths, weaknesses, opportunities and threats of local firms'capability to improve technology innovation by using multinational investmentthrough SWOT matrix, and discussed some management strategies about how localfirms can improve their technology innovation capability and competitioncontinuously at the same time of trying their best to attract MNCs.