| Since reform and opening-up. the market-oriented economic reforms in China have turned the country into one that is the most attractive to foreign direct investment(FDI). but the growth in FDI make us pay the cost of the environment. The deterioration of the environment must bring low quality and unsustainable to the economic development. As our country's environment worsening, the government began to develop implement a series of environmental regulation policies, and focus on how to improve the quality of FDI at the time of conducting environmental regulation, so as to optimize industrial structure and realize the sustainable development of the economy.First of all. on the base of the environment Kuznets curve theory and environmental effect theory, this paper use the method of combining theoretical analysis with empirical analysis. With the panel data of 30 provinces (the Eastern, the Central, and the Western) from 2000 to 2009. based on the unit root test and cointegration test, the paper analyzed the variable stability and long-term equilibrium relation respectively, and on this basis to study the variable Granger causality. We test if the Environmental Kuznets Curve exists in our country, and whether or not the joining of FDI variable may impact our country's environmental pollution levels. The results show that Environmental Kuznets Curve exists in our country, and then referencing environmental Kuznets curve theory, we use FDI instead of per capita GDP to inspect the influence of FDI on the pollutant discharge level. The results show that in the national scope, eastern and western part, the relationship between environmental pollution levels and FDI presents a quadratic function change, while in the central area this relationship is not significant.Secondly, with the same panel data, in the basis of environmental regulation theory, this paper researches whether environmental regulation has affection on our country's FDI absorption. With industrial pollution treatment investment to represent the environmental regulation variables, use the unit root test and cointegration test to analyze the variable stability and long-term equilibrium relation respectively, and on the based of it study granger causality of variables. Then we make a multiple regression model using industrial pollution control investment. GDP of average per capita, average wage of staff as explanatory variables. The results show that the environmental regulation has a significant impact on foreign direct investment of Eastern part. and it is a negative correlation. While from the countrywide perspective the environmental regulation has a positive correlation with FDI.Finally, on the base of the first two chapters' empirical analysis, the paper takes environmental pollution and foreign direct investment as a system endogenous variable, constructs and estimates simultaneous equations. The regression result is good, and the higher adjusted R2 shows that equations fit better, most of the coefficients are significant, and the parameters of the symbols are consistent with theoretical expectations.In the basis of above conclusions, this paper puts forward corresponding countermeasures and suggestions for the formulation and implementation of investment policy and environmental regulation policy combining China's situation, in order to realize the coordinated development of introduction of foreign direct investment and the protection of the environment. |
