Foreign Participation And Labor Productivity Of Domestic Enterprises

China's economy has maintained rapid development since the reform and opening,this is closely related to opening policy which China has adopted, it has a far-reaching effect on the development of economy and society to introduce large amounts of foreign capital. But there is no final conclusion whether foreign participation has a technological spillover effect on domestic enterprises.This paper is mainly to investigate whether foreign participation has a effect on the labor productivity of Guangdong's industry sectors, we use the 33 industrial sectors panel data of Guangdong for period 2001-2007 .In consideration of heteroscedasticity and cross-sectional relation and serial correlation,we take corresponding methods to solve these problems. Then some conclusions are drawn, on the whole, foreign participation has a negative technological spillover effect within the industry on Guangdong's industry, namely FDI has a"crowing out"effect on the same industry of domestic enterprises. But in consideration of different industrial characteristic, it is found that the foreign participation have different technological spillover effect on different industry .Specifically, it is mainly manifested in the following respects: on the one hand, technological spillover effect is significantly negative when the technology gap is smaller between foreign enterprises and domestic enterprises, but there is certain degree of positive technological spillover effect when the technology gap is larger between foreign and domestic enterprises, and the result is significant. On the other hand, the scale difference between foreign and domestic enterprises has little effect on technological spillover effect, while the proportion of foreign enterprises significantly influence technological spillover effect, that is, the negative technological spillover effect is smaller when the proportion of foreign enterprises is greater and smaller when the proportion of foreign enterprises is smaller. In the end, the higher the industry foreign reliance is, the more obvious the"crowing out"effect on the same industry of domestic enterprises will be; the negative technological spillover effect is smaller when the export reliance of domestic enterprises is higher; technological spillover effect is negative when export reliance of foreign enterprises is low and positive when export reliance of foreign enterprises is high.This paper consider the robustness of estimated result, in consideration of endogeneity and measurement of the degree of foreign participation and irregular sampling, we find that the estimated coefficient and its significance don't change obviously, so we can claim that the estimated result is robust.