Research Of The Relationship Between Foreign Direct Investment And Shanghai Employment

This paper reviewed the important theories of FDI effects on host country's employment and some main literatures from both home and abroad. Basic of these, I use the direct effects and indirect effects as my research's basic framework. I subdivide the direct effects into the source and the industry. The indirect effects include how FDI effects the employment of local companies. I use the data of Shanghai Statistics Yearbook from year 1982 to 2009 to make a quantitative analysis. The result shows that FDI is clearly good for the employment of Shanghai, but the results of direct effects, indirect effects and the factors these two effects have been subdivided are quite different. This means from the different views, the relationship between FDI and employment is different. At the end of this paper, about how to enhance the direct effects, I suggest that Shanghai should improve the effect of different area's FDI on the structure of employment and let FDI on labor and capital tech intensive industry grow together. For the indirect effects, I suggest that we should enhance the relationship between multinationals and the related local companies. On the other hand, adjust the structure of secondary industry's FDI and encourage the multinationals to research and develop new products to avoid the competition with local companies.