| Foreign Direct Investment (FDI) is an important policy in the process of economy development and it has played an very essential role in supporting the economy increase of China in recent 30 years. Anhui province is near to Jiangsu province and closely connected with it in economic aspects, but Anhui has fell far behind in economic development, the reason of which is the great influence brought by the difference of FDI. In recent several years, Anhui province is faced with great chance brought by the strategies of advancing the rise of central part of China, its intergrating of Yangtse Delta and undertaking of industry relocating demonstration area,which aims to realize its leap-forward development in economy. To be specific, the purpose of these stategies is to absord investments and undertake the industry relocation from domestic and abroad. Therefore, a study of the FDI's infulence on defference in economic development will be very meaningful for Anhui province to take use of foreign capital in its economic development.This paper uses the analysing method of Econometrics and the latest figures and material from Anhui and Jiangsu province, which are closely connected in culture, economy and some other aspects in society, to give a study on the FDI's infulence on defference in economic development, which hopes that Anhui province can grasp the great chance and realize its uprise in economy. The paper firstly takes a review of area distribution of FDI and some related economic theories and its research status, then it gives an comparative analysis on the defference in economic development and distribution of FDI in Anhui and Jiangsu province, and find that the economic differnce in these two provinces is changing synchronously to that of FDI'distribution. Thereafter, the paper uses the Econometric Model to demonstrate the two provinces' relations in economic developmemts. There are a three aspects in the paper. The first is the testing and verifying of the difference in FDI and economic development, the result of which shows that difference in FDI and economic development have a two-way Granger Consequence relations at a level of 10%. The second aspect takes a test respectively on the relatons between FDI and economic increase, the result of which shows that FDI has pushed Anhui economic development and its economic development has influenced the absording of FDI, which is the same in jiangsu province. The third aspect is about the analysis on relations between FDI and Capital Accumulation and technology advancement. The result shows that FDI in anhui has a two-way Granger consequence relations with its Capital Accumulation and technology advance. It also show that FDI in Jiangsu province has a two-way Granger consequence relations with its stock of capital at the level of 10% and 5%. Therefore, it is concluded in the paper that FDI has great infleunce on the two provinces' economy mainly from the aspects of Capital Accumulation and technology advancement.At last, the paper gives an analysis on the result of demonstrating test and elaborates the existing problem in absording and taking use of FDI in Anhui province in a comparative way with Jiangsu Province. Based on the analysis above, the paper gives some suggestions on how to absord and take use of FDI, which include grasping chance and taking full use of country's support, optimizing investing environment and fostering local industry cluster, promoting industrial and human resources competiveness and enhancing the quality in taking use of foreign capital to realize the industry structural adjustment and improvement and homonious unification of economy,environment and siciety. |
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