An Empirical Study On The Promotion Of Technological Innovation In Guangdong Through Utilizing FDI

Since the reforming of China, the technology has improved significantly and economy has developed greatly. But, how to promote the technology of enterprise so as to maintain the rapid growth of Chinese economy is a difficult problem, which is the topic of this paper. This paper analyzes this topic through the FDI approach and obtains some new conclusions and policy enlightenment.Paper first reviews the recent research achievements. Then we investigate deeply the theory of FDI promoting the technological progress through four channels:competition effect, linkage effect, staff flow effect, demonstration and simulation effect. Based on the theory analysis, we use the 1979 to 2008 data of Guangdong province to do the empirical analysis after a brief introduction of FDI utilization in Guangdong province. And we find out that, the FDI and TFP are Co-integrated in the long run that in the long run the FDI has promoted the technological progress of enterprise. Finally, based on the empirical research above and the feature of FDI utilization in Guangdong province, we brought up some policies:Guangdong province must further improve the circumstance of investment and encourage competition between enterprises in order to attract FDI flow in Guangdong province, which can spur the development of Guangdong's economy.