A Research On Reverse Technology Spillover Of China’s Outward Foreign Direct Investment

In the world today, the R&D and innovation of technology has become the key for a country to obtain core competitiveness. It’s difficult to stand on one’s own feet to do R&D, and many developing countries don’t have enough ability to the development of new technology. With the increase of international communication and the flow of international capital, technology spillover becomes one of the important channels for a country to get advanced technology. What’s more, there are inseparable relationship between OFDI and technology spillover effect, so what problem this paper study are the situation of Chinese OFDI and the reverse technology spillover effect of OFDI. In order to solve these problems, this paper analyses the relationship between OFDI and technological advance by three aspect of theoretical analysis, empirical analysis and case analysis.Based on the theoretical analysis, we can draw a conclusion:OFDI can enhance the home countries’technical level by reverse technology spillover effect, and the rise of the technical level will encourage more enterprises to invest foreign countries. In the empirical analysis, we select the investment stock and total factor productivity as the indicators, and apply granger causality test to analyze the causality of China’s OFDI and technological advance. We find that China’s OFDI can promote technological progress. In case analysis, this paper analyses the process of technology transfer after the acquisitions of Geely and Volvo. Finally, according to the above conclusions, this study provides relevant policy suggestions to make reverse technology spillover effect more pronounced.