An Empirical Study On The Impact Of FDI On Jiangxi's Industrial Structure

Since the reform and opening-up, with China's sustained economic growth and the acceleration of economic globalization, foreign direct investment (FDI) has been developing rapidly, and has become an important part of China's economy. Jiangxi province, as an inland province in central, her introduction of foreign direct investment started lately, and experienced a long period of slow growth state. But in recent years, Jiangxi sizes up the situation, timely puts forward the "Three Bases and A Back Garden",a new development orientation, and takes more measures to increase foreign direct investment and undertake the industries transfer from coastal provinces. The industries development and the actual use of FDI have made great progress. Currently, Jiangxi Province is vigorously building"Poyang Lake Ecological Economic Zone", a National-level regional economic plan. The industrial development and the introduction of FDI are facing new opportunities. Therefore, the study of the relationship between FDI and industrial development and how to use the FDI to promote the industrial upgrading has important practical significance.The article first reviews and summarizes the domestic and foreign scholars'related research on FDI and Industrial Restructuring. On this basis, the article establishes the theoretical basis of research and research ideas. Then, based on a systematic analysis of the development process, characteristics and shortcomings of FDI and the industrial structure of Jiangxi Province, the paper makes an in-depth inquiry in the mechanism of the influence between the FDI and the industrial structure of Jiangxi, and concludes that the main reasons affecting the industrial restructuring and upgrading contain three main factors, including the supply factors, demand factors and international trade factors, and FDI promotes industrial upgrading mainly by increasing the supply of capital and technology. Then, through the ADF unit root test, cointegration test and Granger (Granger causality) tests, the paper further analyze the relationship between the industrial upgrading and FDI by 1994-2009 Jiangxi data, and the conclusions of the examinations show that cointegration relationship between three major industries and its FDI exists, which means the existence of long-term equilibrium relationship between the two variables, and the Granger causality works in the secondary and tertiary industry. At the same time, the regression equation results show that foreign direct Inflows contribute to the decline in the proportion of primary industry and the increase in proportion of secondary industry and tertiary industry, and be conducive to optimizing the structure of the three industries; And the regression equation results also show that FDI can bring more domestic investment ,especially significant in the secondary and tertiary industries, while the technology spillover effect is only significant in the secondary and tertiary industries. In short, FDI effects the development of three industries mainly by domestic capital Crowding-in Effect and technology Spillover Effects, and its different effects on the three industries are an important reason for the industrial restructure.The empirical analysis results consistent with the industries development law, which means the previous research findings base on the coastal areas also fit Jiangxi.Finaly, the paper puts forward relevant policies according to the empirical analysis results.