Analysis Of The Influence Of The Structure Of Production Factors In The Causes Of Foreign Direct Investment

Four decades of reform and opening-up.China's economic development has made remarkable achievements.At the same time,since the implementation of the,going global"strategy in 2001,the scale of China's OFDI has also grown rapidly.From the first announcement of the amount of OFDI in 2003 to 2016,China has achieved positive growth for 14 consecutive years.According to the investment development stage theory of Dunning,there is a certain correlation between a country's economic development level(per capital gross national product)and the country's net foreign investment.With the improvement of the per capita GNP,a country's net foreign investment presents the process from negative to positive.In 2015 China's foreign direct investment scale for the first time exceed the foreign direct investment inflows.Dunning combines a country's stage of ofdi development with its economic growth.However,the development stage of a country's OFDI should be related to its economic development stage in addition to its economic growth stage.Because the connotation of economic development is richer,economic development not only includes economic growth,but also include a series of factors affecting economic development and OFDI,such as economic restructuring,industrial structure upgrading,market structure reform and factor structure optimization.Traditional economic growth theory regards the economic development of a country as the realization process of industrialization and modernization.Structuralism regards the economic growth and development of a country as the transformation of production structure.However,from the perspective of economic growth model,every breakthrough in growth theory lies in the rediscovery of the concept of production factors and the continuous improvement of the understanding of factors.It can be said that factors of production are the source of economic growth,and the economic development of a country depends on the progress of factor structure.However,there is imbalance in the structure of factors of production in China.From the quantitative structure of factors of production,affected by falling fertility rates and the aging of the population,China's current labor element quantity is decreasing year by year,with the resource price in China has been reappraised and repriced after opening-up and economic growth all Accelerate China's capital accumulation,at present our country the capital labor ratio increases year by year,accelerating the deepening of catipal.At the same time,in terms of the price structure of production factors,there are serious price absolute distortions in China's capital factors and labor factors,and the negative distortion of the price of capital factors is greater than that of labor factors.The high negative price distortion of capital factor is closely related to the domestic institutional background.In order to give priority to the development of heavy industry and accelerate the development of domestic economy,the government has implemented a series of measures to distort the price of factor market,and thus created the institutional basis for the distortion of factor price in China.The degree of distortion of factor prices has been continuously strengthened through China's fiscal and taxation system,local government performance evaluation mechanism and development policies dominated by attracting foreign investment.The negative price distortion of capital factors leads to the over-investment of capital factors in China,promotes the rapid development of capital-intensive industries,and leads to China's dependence on the traditional investment-driven economic growth model.At present,China's foreign direct investment scale is growing rapidly,the growth rate of the foreign direct investment has exceeding the economic development stage,according to the 2017 statistics bulletin of the national economy and social development,the data showed that China's per capita GDP of $8836,according to Dunning's investment development stage theory,our country is now at the second stage,the stage with a negative net foreign direct investment.However,in 2015,the scale of China's OFDI exceeded the scale of attracting foreign investment for the first time,realizing the net capital export under the two-way direct investment flow.China's OFDI is carried out under the background of progressive reform in China.The rapid development of OFDI is inseparable from the distortion of domestic factor price and the change of factor structure.Domestic factor price distortions,especially negative distortion of capital factor prices,led to the excessive investment of capital elements and the rapid growth of capital-intensive industry,the rapid growth of the capital-intensive industries by lowering the marginal output of capital elements,increasing internal competition and leading to problems such as redundant construction and overcapacity,promotes the foreign direct investment of capital-intensive industries;The increase of labor cost leads to the increase of domestic manufacturing cost,which often makes manufacturing enterprises have the motivation to reduce production cost through overseas direct investment.From the perspective of economic development,this paper studies the influence of China's industrial factor structure and host country's factor endowment structure on the OFDI decisions and location selection of manufacturing enterprises under the background of changes in domestic factor structure by using micro-enterprise data.The empirical results show that the higher the capital intensity,the higher the probability of OFDI.The probability of OFDI of enterprises in capital-intensive industries is higher than that of labor-intensive industries,and the impact of industry capital intensity on OFDI of enterprises is mainly realized by improving the capital intensity of enterprises.The rapid development of capital-intensive industries by high domestic investment and the influence of resource price revaluation effects,resulting in industry development stage ahead of scheduleand foreign direct investment "in advance",the enterprise has not yet been cultivating the competitive advantage of the foreign direct investment,was "pulling up seedlings to help them grow".So we can foresee our country enterprise of foreign direct investment eff-iciency is low,the failure rate is very high.From the perspective of the path of global industrial structure change,capital-intensive industries' OFDI is more,which is not only the inevitable trend of global industrial structure change from low-value-added labor-intensive industries to high-value-added capital and technology-intensive industries,but also the inevitable trend of China's manufacturing industry transformation and upgrading.Although China's OFDI scale has made remarkable achievements at present,it is necessary to accelerate the reform of domestic factor market and reduce the price distortion of factor market while the scale is rising,so that the scale of China's OFDI can truly reflect the competitive advantages of enterprises.At the same time,through the study of the heterogeneity of enterprises and the location characteristics of the host country,we found that the capital-intensive enterprises in China tend to invest in countries with abundant labor force,and their efficiency investment motivation(cost reduction)is obvious.International direct investment and international trade are two main forms for a country to participate in the international division of labor.The resource endowment structure of a country is not only the foundation of a country's international trade,but also the foundation of a country's foreign direct investment.The differences in international resource endowments and the resulting differences in factor returns lead to the international flow of factors of production.In the sample of the study period,the capital-labor ratio has been reversed in our country.by the relative abundance of national labor to capital relatively affluent countries.China's capital-intensive enterprises tend to invest to the relative labor-abundance country,production factors' flow direction reflects the structure change of factor endowments and the difference of each country's factor yield rate.The main determinants of Chinese enterprises' OFDI,in addition to domestic institutional factors,state-owned enterprise ownership factors and the imperfect domestic capital market,after the opening of OFDI by private enterprises in 2003,the main determinants of OFDI lie more in the enterprises themselves and the integration of global factor resources by enterprises based on the production factor structure and yield difference among countries.