Technology Spillover Effects Of FDI In Shanghai Area

There is a hot discussion on the spillover of FDI in the economics research. Now China has become one of the countries with much FDI in the world. Effectively absorbing FDI is a shortcut for developing countries to develop. Lots of documents indicate spillover of FDI has much relationship not only with the feature and motivation of FDI, but also the absorbing capacity of local country.This study focuses on the determinants of inward FDI to Shanghai on home-country. It reviews the structure of different origins of FDI to Shanghai and examines the effect of interior, exterior and environment determinants of Shanghai. A theoretical model is created on the base of cobb-douglas production function. Multiple regression analysis confirms that the specific determinants are home-country related to Shanghai, research, human capital and system. The results show that the FDI from Europe and America have a positive spillover effects on Shanghai, the same situation to Hong Kong, Taiwan and Macau, but negative effects of the East Asian Countries. The ASEAN has not significant effects.This study analyzes the distribution of FDI from a new point of view and provides a new resolution for this field, which is valuable for the similar researches latter on. The result of this study is helpful for the local governments across Shanghai to carry out the strategy policy of central government in attracting foreign investment.