The Relationship Between The Efficiency Of FDI And Regional Economic Differences

After implementation of the open policy for 30 years, Chinese economy has experienced attractive success, with rapid continuous increase of its GDP, from 364.52 billion in 1978 to 30067 billion in 2008. From the endogenous growth theory, this rapid increase of GDP arises from the rapid increase of various inputs, such as labor, investment and especially FDI. So how to measure the role of FDI playing in this increase of GDP is an important problem in this research area; but this paper has pointed out that the role of FDI playing in the process of increase of GDP is different in different regions in China. So to find the reason why the role of FDI is different is interesting. In the international economics, researchers have taken many researches to find the reason, especially from the perspective of different FDI in different regions in China. Based on the outcome of research, they have supplied many advices to equilibrium of different regional economy.From perspective of technological progress based on Endogenous Growth Theory, this paper researches the relationship between FDI efficiency and regional economic development differences. It formulates the panel data model combined with technological variables, and takes Chinese regional economic statistics data from 1985 to 2007 as computation sample. After computation researches, it concludes FDI has obvious promotion effects on Chinese regional economic development, and the effects have obvious difference among different regions. It further researches the intercept values of Fix Effect Model and concludes that the difference of FDI efficiency is based on the difference of regional technological level. So this paper concludes that the key to improve FDI efficiency on regional economic development is not only to absorb high-technological FDI, the more important is to improve regional technological levels which include regional industrial structure optimizing, human resource investment, FDI policies and environment optimizing and others. This research has positive effect on guiding Chinese middle-west regions to improve FDI efficiency.