An Empirical Analysis Of The Effect Of FDI On The Employment In China

The employment problem is a very important problem in the process of the macroeconomic development in China ,We need to resolve the problem. With the deepening of our reform and opening up ,and participating the international economic activities more and more in the recent years, there are a large amount of foreign capital in our market. Therefore ,we should be concerned about the full impact of economic, especially the impact of employment .Studying the employment effects of FDI has great practical significance .This paper analyzes the effects about the employment systematically ,using the qualitive and quantitative methods ,about overall situation and regional disparity.Firstly ,the paper sorts the theory of employment effects of FDI ,introduces the situation of FDI and employment ,then the paper points out that the foreign investment will produce creative effect and extrusion effect ,and the regional distribution of FDI in China is not equilibrium .FDI and employment is not a simple positive correlation relationship .If there are not reasonable guide ,FDI will impact the domestic employment market ,increase the risk of employment market in China.Secondly ,the reality of our country is analyzed by empirically analysis from the China stastical Yearbook 1985-2008 data ,using co-integration analysis ,error correction model ,granger causality test methods .The increase of foreign direct investment can promote employment growth ,but the empirically analysis also shows the contribution to employment is not obvious.Finally,this paper combined with the theory and empirical analysis ,formed the following conclusion:1.FDI and employment is positive proportional ,FDI can directly promote employment,also can promote the development of the relevant industries employment.2.FDI can improve employment quality .FDI brings not only the capital advantage ,but also brings the advanced productive and excellent talents.3.The distribution of FDI is not balanced ,most of capital concentrate in the developed regional , western and central regional is less .FDI let the differences of eastern ,western ,central regional expand .All of these let the distribution situation become worse.