Research On Location Choice Model And Agglomeration Of FDI

China is coming to rise in the world, which known by its outstanding accomplishment of attracting FDI, but the advantage of FDI can't be got by each region. A great deal of FDI agglomerated in the eastern littoral and piecemeal of FDI scattered at the western, which has caused the domestic and international scholars extensive concerns on the location and agglomeration of FDI in china. On the basis of exploring the developing track of international direct investment location thought and combing the predecessors'research results, this paper investigates the location choice and agglomeration of FDI. The detailed work is as follows:1) According to the NEG (new economic geography) pattern, and adopting analytical frame of Dixit & Stiglitz (1977), this paper tries to build up a more comprehensive theoretical model of FDI location. This model generalizes comprehensively affected factors of FDI location; In addition to traditional location factors, it brings the NEG factor agglomerative economy into the influence factors system of FDI location to consider wholly. The model investigates wages level, transaction cost, agglomerative economy, market scale, quantity of labor force and Industrial structure, which functions acted on FDI location in host country. It can rationally explain vertically FDI and horizontally FDI location choice. The theoretical model further confirms the monopolistic advantage theory, the marginal industry extension theory and Inside the Multinationals theory, and perfects international direct investment theories. In the meantime this paper tries to study the location diversion trend of vertical FDI and horizontal FDI in China; puts forward the policy suggestion for our country to draw on FDI.2) On the foundation of vertical FDI and horizontal FDI theoretical model, this paper investigates positively FDI location choice in China. By making use of panel data model to examine the influence of wages level, transaction cost, agglomerative economy, market scale, quantity of labor force and Industrial structure to FDI location choice. Opposite to other scholars'researches, Leads industrial structure and transaction cost these two factors especially into the positive research, carries on the innovation processing to these two factors, and gets some important conclusions and enlightenments from the positive result. The research indicates:different types of FDI have not only some common location factors, also have the difference factors, the invest subjects request the different space factors association because of their different characters.3) Induces the spatial evolution characteristics of FDI regional structure in China; later apply normal theories and rigorous methods of economics to research economic geography phenomenon of FDI agglomeration. Follows the thought spark of Krugman, Constructs demand function including market approaching effect and cost function including market competition effect, and builds up an oligopoly output competition model consisted of multinational enterprises and the host state enterprises; This paper tries to explain the spatial agglomeration mechanism of FDI. Moreover analyzes the policy strength carried on by lagging regions to attract foreign investment. The result shows:the more fall behind the regional economy development is, the more favorable policy the government would provide. Moreover analyzes the large-scale industry transfer tide of FDI taking place in China in cost angle of view.4) In recent years the variety of FDI location exhibits a marked characteristics of home-country agglomeration, On the basis of the oligopoly output competition model consisted of multinational enterprises and the host state enterprises, introducing a guess variable that calculate the cooperation degree between firms, this paper analyzes the behavior of the home-country FDI to locate in medium and small cities and the motivation of home-country FDI agglomeration; From the strategic alliance angle of view, analyzes the motivation and mechanism of home-country FDI agglomeration in China, and put forward the strategy to attract FDI that aims at the characteristics of home-country FDI agglomeration.5) Investigates the current stage that China makes use of FDI and economic influence that China draws horizontally FDI, and then puts forward some transformation suggestions on FDI management system.