The Study Of FDI Spillover Effects On China's Innovation Capacity

As one of the most important carrier for the capital and technology to flow within the world, FDI has been traditionally considered as an important channel in the diffusion of advanced technology. The importance to improve the economy of developing countries is widely considered. Whether it can promote the technology advancement in China? This problem becomes the focusing point for Chinese scholars in recent years. In the world through the advanced technology from FDI to enhance the capacity of regional innovation is becoming more and more important, the study of FDI spillover effects on China's regional innovation capability, as well as the way of FDI spillover is undoubtedly of great theoretical and practical significance.The paper introduces the theories of FDI, regional innovation capability and FDI-related technology spillovers. The statistic data from China Statistical Yearbook 1999 to 2006.Because of China's utilization of foreign investment mainly concentrated in industrial fields, especially high-tech industries, so data in this paper are selected from industrial areas, it uses multiple linear regression statistical methods to study the relationship between FDI and Regional Innovation Capability (RIC). It is found that the spillover effects of FDI are not significant as usually think. The impact of FDI on RIC is strong.Through the study of this paper it gets some conclusion as below:First, the research manifests that increasing domestic R&D inputs, strengthening the innovation capabilities and technology absorbency in domestic enterprise are the keys to improve RIC.Second, the effects on regional innovation capacity is mainly from FDI technology spillovers, but to some extent China's current situation should not meet the technical conditions required for the technology spillover, so only by taking effective measures to improve China's foreign capital utilization limitations in order to improve China's regional innovation capability.