A Domestrative Study: Foreign Direct Investment And Its Contribution To Jiangsu's International Trade

Jiangsu has been made great achievement in terms of attarcting FDI which widely impacts Jiangsu's economy and social development since China's reform and opening-up. It has also induced a lot of argument about FDI, among which whether FDI improves Jiangsu's international trade and domestic enterpries'technology progress or not. Because they have been considered the essential reason why so many developing countries are eager to attract FDI nowadays. This dissertation is aiming at analyzing the function of FDI on Jiangsu's international trade.This dissertation adopts the methods of combing theories and domestration, proceeding from the theories of FDI and summing up large numbers of statistics to analyze objectively the specialties of every period when Jiangsu made use of FDI. We will use comparative analysis and the analysis by ecomomic idexes and econometric models to study the relation between FDI and international trade, the relation between FDI and technology development of domestic enterprises.The dissertation divides Jiangsu's utilization of FDI into thress periods: starting, complete development and promotion in new century. It also concludes the situation of Jiangsu's utilization of FDI with five areas such as the scale and speed of FDI, the district distribution of investment, the countries of FDI, the indutrial distribution of FDI and the ways of FDI. It further studies domestratively the impacts of FDI on the Jiangsu's international trade and technology development. Firstly, we establish Polynomial Distributed Lag (PDL) model, which widely includes accurated FDI, recent and two lag periods FDI influence positively the quantity and quality of Jiangsu's import and export, especially, the accurated FDI plays an important role on the export and the instructure of international trade. Secondly, the result based on a panel data analysis of 23 countries'(regions') data during the period of 2000-2004 supports that FDI improves Jiangsu's region instructure of international trade. Thirdly, we establish a dynamic two-sector model to analyze the technology spillovers of FDI. Empirical results demonstrate that the improvement of degree of market-opening-up and infrastructure play an important role on the spillovers of FDI. We also prove that its spillovers promote the export of labor-resource-intensive products.Conclusions and policy implications have also been made finally.