Foreign Direct Investment And The Shanghai Municipal Economic Growth In Empirical Research

According to the time series data of FDI and GDP of Shanghai from 1981 to 2004, we have examined the relationship between FDI and Shanghai's economic growth by Co-Integration Test and Granger Causality Tests. The research results indicate that there is a unilateral causal relationship between Shanghai's economic growth and FDI, which is GDP does not Granger Cause FDI but FDI does Granger Cause GDP. In addition, we believe that FDI does promote Shanghai's economic growth , and the research analyzes the mechanism of how shanghai attracts FDI.