The Study On The Technological Spillover From FDI And The Absorptive Capacity Of Local Enterprises In Guangdong Province

As the main form of international capital flow, FDI plays an important role in the development of host countries and home countries. The scholars both home and abroad pay more attention to the technological spillover from FDI. Based on theoretic analysis, FDI can cause some technological spillover to the host countries, but most of empirical results about developing countries are different. The main explanation is the different absorptive capacity of host countries. As a result, the scholars begin to study the absorptive capacity of host countries. Now there are not many studies on this topic, most of which are about macro-aspect. This paper shows enterprises are the most important one to absorb the spillover, so it is necessary for us to study the spillover from the aspect of enterprises. This paper chooses Guangdong province as the object because it attracts most amount of FDI in china. Firstly, the paper reviews the former theories. Second, based on the panel data of 28 manufacturing sectors during 1997-2005, the paper employs empirical method to estimate the technological spillover effect from FDI. The result shows that on the whole FDI contributes positive technological spillover to the domestic enterprises especially to the industries with higher technology and to the state-owned enterprises. Then the paper constructs a model of absorptive capacity and further analyzes the technological spillover from the aspect of the absorptive capacity of local enterprises. Finally, the paper comes to conclusions and puts forward some suggestions.