The Empirical Study On The Effect Of FDI Affects Transference Of Redundant Rural Labor Force

Redundant rural labor force began to appear since the end of1978for thehousehold contract system improved agricultural productivity. However, there isalways excess redundant rural labor force in country for the dual economy structure.Like many developing countries or regions, China’s foreign economic relationshipsare the export-orientation developmental strategy since the reform and open policy,deciding FDI has the model labor-intensive form characteristic in manufacturingindustry centralism. The continuous inflow of FDI not only alleviates the problem ofshortage of capital and technology, but also creates massive employment opportunity,promoting the redundant rural labor force transfer from rural to urban. Using theprovincial Panel Data during1996-2008, the paper studies effects of FDI and thetransfer of redundant rural labor force from both theoretical and empirical aspects.A universal mutual recognition is that, there are significant differences ontransfer capacity and convergence speed between provinces and three major regions.Based on the theory of Braun population migration, this paper provides a frameworkof dynamic transfer and stable convergence of redundant rural labor force. Theempirical results show that, there is absolute-convergence throughout country, butthree major economic regions isn′t; there are significant conditional-convergence inthe east, the west and throughout the country; the imbalance regional distribution ofFDI is an important reason for the region imbalance of the transfer of redundant rurallabor force, this can be improved by industrial gradient transfer of FDI. The furtherempirical research shows that Labor-intensive FDI is the most important factor forattracting redundant rural labor force; the "employment threshold effect" wasimproved by positive spillovers of FDI and optimizes the investment structure, whichhinders redundant rural labor force transfer to the city; the urbanization and transferof redundant rural labor force assuming opposite direction alteration, reflecting thedeviation of urbanization and industrialization. Finally, on the basis of the analysis,the article puts forward several suggestions.