The Research Of Relations Between FDI And Economic Growth

The current of internal capital among all the countries in the world increase day by day along with development of the course of global economic integration .However, the FDI is the most important part of current internal capital. FDI used by Xi'an city having already got through more than 20 years and got the amazing accomplishment. Xi'an city is located in the Northwest region which is less advanced in our country, which is core city of the strategy of developing the western region. Xi'an city has a better economic foundation in western region. Therefore, making use of FDI in Xi'an city, to some extent, is typical and representative. There are many research articles about the relations between FDI and development of economy by either internal or external scholar. However, there are few research articles focusing on less developed Northwest region.Firstly, the thesis analysis the character of FDI of Xi'an city based on research achievements about FDI and development of economy of internal and external. Secondly, it build Econometrics models described the mutual relation between FDI and GDP of Xi'an city by Econometrics according to economy development theory,then Carry out regression analysis, co-integrate tests and Granger causality tests. Furthermore it draw a conclusion that the relation between FDI and GDP of Xi'an city show regular correlation relation; the effect leaded to GDP by FDI is too little; long-term overflow effect is less than short-term demand effect; there are long-term stable relation between FDI and GDP, but dose not constitute the Granger causality. Lastly, the paper put forward that there be some problems in attracting FDI of Xi'an city throughout comparative analysis, including the constructor of attracting FDI is irrational; the subject, fashion and source of attracting FDI is single; the invest cost is too expensive; the market and supporting service system is imperfect .Finally, it advance that if Xi'an should make the FDI policy standard, activity make theinvest environment better,optimize the FDI structure and expand fashion of attracting FDI, build attracting band and industrial chain, create assemble effect and encourage foreign capital merge and transform the government-owned corporation to improve attracting FDI.