The Theoretical And Empirical Study Of Foreign Direct Investment Effect Technological Innovation

In the21st century, with the rapid expansion of technology globalization, Foreign direct investment (FDI) plays an important role to developing countries’ technical innovation capability. However, the entry of multinational companies to the domestic market, whether it is tremendous competitive pressure, thereby enhancing the competitiveness of domestic enterprises? Or our country has become a global industrial chain manufacturing base? Therefore, more rational understanding of the role of foreign capital has important reference value.First, in order to better illustrate the mechanism and the degree of FDI effecting China technology innovation, the paper from the input factors, openness, institutional factors, in the micro-level factors and the remaining absorptive capacity5part analyzes the factors that affect the ability of technological innovation. Then, There are direct effects and indirect effects to analysis the mechanism of FDI. Direct role include demonstration and imitation effects, mobility effects and contact effects; indirect effect includes technology opportunities and technology-based on the base of technology system, and market competition and market growth of the market structure.Second, deduces the econometric model on the base of China economic, from the classic Griliches-Jaffe knowledge production function. we use panel data of the foreign direct investment, independent research and development (R&D) investment and human capital) and institutional factors on the impact of technological innovation in China. We draw the following conclusions:(1) as national patent application number, invention patents number, utility model patents number and design patents number to the dependent variable, the FDI to China will promote the generation of innovation;(2) In the sub-regional empirical analysis, we found that, FDI has obvious regional characteristic, that is, FDI had no significant to the eastern region, effect on the central region significantly positive, the western regional influence is significantly negative;(3) both at the national or sub-regional empirical analysis of the degree of non-nationalization, degree of urbanization and the opening of three institutional variables are directly enhance the technological innovation in China capacity, and also by enhancing FDI indirectly enhance the absorptive capacity of technical innovation in China;(4) National and sub-regional R&D investment of the patent applications have played a significant positive effect, and the contribution of large and scientific and technical personnel into the three areas is not satisfactory, indicating that the efficiency of scientific and technical personnel of the research is not very high. In large measure, the results still depends on technology R&D investment. The results show that we can not blindly think that the introduction of the better foreign investment, FDI on domestic enterprises to promote the role of technology is not generally considered as significant, its role is limited. Higher levels of FDI, does not necessarily lead to greater innovation and creativity.Finally, the study found the feasible policy recommendations of the problem, and still put direction of this research plan the next step.