Study On The Relationship Between The Three China’s Foreign Direct Investment, Financial Market And Economic Growth

After thirty years of sustained and rapid development, the total amount of GDPin China in2008reached30yuan, more than Germany to become the world’s thirdlargest economy, therefore, along with our country reform and open policy theimplementation, the economic development of our country has achievement,international status has been greatly promoted. For developing countries, theimplementation of the opening-up policy, foreign direct investment (FDI), use the uptheir economic gap, development fund to promote exports, improve the domesticcapital enterprise production technology, improve the level of national income level tostimulate the economic growth of a country, has been open to the outside worlddeveloping countries are expected to reach the effect of. As for our country, ourcountry’s economy and economic power than in the past has been greatly improved,from the development of the our country now, the introduction of FDI to make up forthe shortfall in funds of our country is not the main purpose, our country is in theindustrial structure adjustment, the period of economic transition, the main purpose ofthe introduction of FDI should in the FDI gave me the direct and spillover effects, theaccumulation effect, the level of foreign advanced technology, managementexperience, the absorption and utilization of FDI in the capital, to improve thetechnical level of our country and the ability of independent innovation, accelerate thepace of China’s economic structure adjustment, in order to promote China’s economicgrowth, promote me country’s comprehensive competitiveness in the internationalmarket.The domestic and foreign research and experience tells us, the financial marketeffects on FDI conduction plays an important role can not be ignored. The developedfinancial market by promoting the transformation from saving to investment, providefinancial support, for the enterprise to provide the tools for the enterprise M&Atransactions, lower transaction costs, the spillover effect of quick and convenienttransaction channel can amplify FDI, push FDI to promote economic growth. Inrecent years, China promulgated a series of relevant policies to improve the financialmarket, but the domestic financial market development level of our country islower than the level of development of the domestic financial market in developedcountries. Interaction between these three clear FDI, financial market and economicgrowth, and those are the three ways of interaction, it has theoretical and practical significance on the future direction of development, China’s policy making.Based on this, this article takes the three FDI, the financial market and economicgrowth as the research object, firstly analyzes the mechanism of interaction of therelationship between the three, takes the economic significance for panel data, thesupporting structure VAR, VEC model, the FDI, the financial market and economicgrowth is the international comparison and the system analysis. Panel data modelresults show that: compared with the representative of the developed countries and thedeveloping countries and regions, China’s economic growth is the fastest, theeconomic growth effect of FDI in developed countries than in developing countries,financial markets of developed countries to promote FDI to promote the country’seconomic development, and the financial markets in the developing countries is forFDI to promote economic the role of growth is weak, even played the hindrance role.FDI, China’s financial market has the very big disparity compared to promote theeconomic growth of developed countries and the developing countries and regions,and compared in a secondary position, shows that China’s financial market, FDIpromotes economic growth there is still considerable room for development.According to the SVAR model results, China’s GDP growth can lead to financialmarket growth, economic growth and financial market development has greatlypromoted the development of the introduction of FDI. But although China the largestdeveloping countries in FDI absorption in the world, but the FDI on the developmentof China’s financial market and economic growth is not a positive role in promoting,between our country’s financial market and economic growth is promoted each other,but the mutual influence is the smallest. This shows that, China’s financial market isnot developed, the financial market can promote economic growth, China’s financialmarket to reduce the spillover effect of FDI, FDI impede the economic growthcontribution rate.Therefore, the policy of opening to the outside world and the developingcountries, need to improve, improve, develop their economy, financial market, homeand abroad to create a good investment environment, increasing market competition,improve the rate of capital accumulation and allocation efficiency, give full play toFDI, the financial market to the economic growth of the active role.