The Impacts Of China’s ODI Reverse Technology Spillover On The Total Factor Productivity

In recent years, China’s economic develop rapidly, foreign direct investment activitiesalso rise, in2011, China’s direct investment cumulative600.7billion dollars, maintaingrowth momentum for nine consecutive years. Although China in the field of foreign directinvestment has been some success, there are still many problems, lack of core technology,inadequate digestion and absorption capacity, the capability of independent innovation isweak, that makes our country only to follow the pace of developed countries forever, nevercan get control on advanced technology.With China’s foreign direct investment continues to increase, whether China’s foreigndirect investment and China’s total factor productivity have a stable dynamic equilibriumrelationship? Chinese enterprises whether can obtain advanced technology through foreigndirect investment in the host country, to enhance the capability of independent innovationin our country? All need to be solved at this stage. Total factor productivity as acomprehensive index, represent a country’s development level of productivity andtechnological progress. Therefore, this paper selected three variables data of1987-2010total factor productivity, foreign direct investment stock and domestic R&D capital stockin24years, using regression analysis model, making a empirical analysis between China’sforeign direct investment and total factor productivity, and the result is that the stock offoreign direct investment for each additional one unit of total factor productivity growth ofthe conclusions of0.09656units. From an empirical point of view proves that foreigndirect investment has technical adverse spillover effects, and can promote technologicalprogress. Finally, according to the present situation and shortage of China’s foreign directinvestment, putting forward some policy recommendations that can play a greater degreein foreign direct investment to promote domestic total factor productivity.