Regional Economic Disparities And Foreign Direct Investment

As result of the government's deregulation, Foreign Direct Investment (FDI) has flow into various industries and regions, and has a positive effect on economic growth in China. FDI provides enough capital, advanced technology and methods, and increases productivity. Meanwhile FDI facilitates employment and export, increase government income and foreign exchange saving, and has become important economic component. However FDI has its negative influence on economy, for example, it squeezes out domestic investment and the capital flow led by profit deepens the regional disparity.Economy grew at a high speed in recent years in Shan-dong Province, but income gap increased with the economic growth and the regional economic disparity expanded. A important one among the reasons is FDI gathered in the eastern district and its regional distribution is lack of equilibrium. Many literatures studied the relationship between FDI and regional economic growth in China, but there are few studies on FDI and regional economic growth in Shan-dong Province. Therefore it is valuable and meaningful to study the effect of FDI on regional economic growth and regional disparity in Shan-dong Province.On the base of the analysis of regional disparity and disequilibrium of FDI's contribution in Shan-dong Province, this paper studies FDI's spillover effect and the effect of FDI on regional economic growth and regional disparity in Shan-dong Province, and bring forward strategy of using FDI and suggestion to reduce regional disparity. This paper consists of the following five parts: the first part puts forward the issue and contains relevant literature review, method, and the main structure of the paper. The second part analyzes the exist state of regional economic growth in Shan-dong Province, the regional disparity of economy in Shan Dong province by the...