A Study Of FDI-induced Industry Cluster

In the background of globalization, agglomeration becomes a new way to develop the economy of a country. At the same time, the investments of multinational corporations are all around the world and becoming an important factor on both the formation and development of industry agglomeration. So this paper will analyze the way of FDI to promote industry agglomeration in formation, development and upgrading. And then, the factors of how FDI have impact on agglomeration are analyzed. Since the implement of the reform and opening up policy, Jiangsu Province, locating in the area of Yangtze River Delta, had introduce a large amount of FDI with a variety of preferential policies, especially in the sector of manufacturing. So this paper will take manufacturing sector of Jiangsu as an example to analyze the impact of FDI on agglomeration empirically in the overall level and industry level. At last, some pieces of advice are given in using FDI to promote agglomeration economy on the basic of theoretical and empirical analysis above.