FDI Spillovers And Impact On Technology Capability Improving Of Local Firms

Ever since 1960s, the research on FDI spillovers has become a hot issue, a lot of scholars in international investment field have paid great effort in finding the existence and determinant factors of FDI spillovers, by developing various mathematics models to test data from different countries. As the heterogeneity of models and samples, the empirical results vary greatly. Whereas, in recent years, some scholars think the studies on FDI spillovers should consider the agglomeration factor, because the multinationals have infiltrated into some local business clusters gradually, and some of those local clusters were originally propelled by the multinationals to form. Therefore, facing the phenomenon of FDI agglomeration in the Yangzi River Delta Region in China, it will be meaningful to exploit the existence and determinant factors of FDI spillovers under the context of business cluster.This paper begins from the literature review in FDI spillover and cluster knowledge spillover, then makes a brief introduction for the FDI-based clusters in Suzhou area, and then put forwards the research hypothesis; based on the hypothesis, a survey was conducted, and by the survey results, I empirically tested the FDI spillover channels and determinant factors. Finally, I made a conclusion and put forward advices for local firms to improve their technology capabilities, based on the expirical results.