Research On Technology Seeking FDI Based On Reverse Technology Spillover Effect

The technology spillover effect of FDI which is created by developed countries todeveloping countries are mostly used as subject of study by scholars both from home andabroad and there has been many representative results. However, research focused on FDIby enterprises in developing countries and its technology progress impact on homeland isrelatively few and so far no more achievements have been achieved. Therefore, there isstill broad space for further research on this issue. Since China implemented the "goingout" strategy, lots of strong enterprises go out of the country and carry out activities ofexternal expansion, which provides abundant cases and factual basis for research ontechnology-seeking foreign direct investment of Chinese enterprise. The constantimprovement of China’s statistical system makes it possible to get access to statistics in thisfield and that provides data support for our research.This article first introduces the background and significance of this issue and depictsthe research status, methods, structure and innovative points, then it defines several mainconcepts. In the Following, it introduces related theories of FDI reverse technologyspillover effect. There are mainly three aspects about it. First, it introduces developed anddeveloping countries’ theoretical result on foreign direct investment; Then it analyzes themotivation of foreign direct investments in technology; lastly it illustrates reversetechnology spillover realization mechanism from four aspects of the reverse technologytransfer, research and development achievements feedback, research and developmentcost-sharing and localized management feedback. The third part of this paper is theanalysis of the development status of technology-seeking FDI.For this part, it emphasizes Chinese enterprises’ technology-seeking foreign directinvestment from four aspects: subject selection, industry selection, location selection andmarket entry mode. Then the fourth part is about empirical test. With reference to Coe&Helpman’ research and Bruno Van Pottelsberghe&Lichtenbeg’ research, it constructs theInternational R&D spillover model and then tests the size of the reverse technology spillover combined with China’s foreign direct investment practice. The results showed thatFDI with the technology-seeking purpose can contribute to the improvement of China’stotal factor productivity. Eventually, combined with the conclusion and the status offoreign direct investment in China, it goes to the policy recommendations from the nationallevel and also the enterprise level.