The Effect Of FDI On Shanxi Coal Industrial Upgrading From The Perspective Of Industry Chain

Three decades of reform and opening up the achievements justamazing, exports have been the key factors of China economicgrowth, but after the outbreak of the financial crisis. China’slow-cost advantage will not last long. Promoting economictransformation and upgrading is the inherent requirement of China’seconomic development, and this study has important practicalsignificance for the resource type area of Shanxi industrialupgrading, economic restructuring and development, this study hasan important significance to reduce China’s regional economicdevelopment gap, and promote the transformation of the economicgrowth mode.Although China economy basically a continuation of thedevelopment pattern of East Asian model of export-ledmanufacturing, but Chinese economic development is different fromother East Asian countries lies in its vast domestic market with highlevels of FDI link dynamic foreign and local enterprises. Therefore,the primary problem to be solved in this paper is whether the foreigninvestment push the industrial upgrading. First, we will learn thebackground of how FDI promote china’s economic and industrial structure upgrade, and proposed the mechanism of the upgrading ofthe industrial structure.The second part, we apply this mechanism to Shanxi coalindustry, this is mainly done through two steps, First of all, we putforward the path of Shanxi coal industry upgrading through theconstruction of the coal industry chain. Based on four digits industryclassification of coal industrial chain, FDI promote transformationand upgrading of Shanxi coal industry is the critical point that weconsider. Secondly, we apply the dynamic competition betweenforeign and local companies in the domestic market to Shanxi coalindustry. Although FDI made less impact on the coal industry ofShanxi, but this does not mean that it is not available for coalindustry, the influence of foreign investment in the coal industry isnot directly, but indirectly through its upstream industry. First of all,the mechanization of coal industry rise, the demand of theequipment manufacturing industry increased, especially coalequipment, so to attract foreign direct investment into Shanxi at thesame time. FDI strengthen the competition mechanism in Shanxi, inthe low-end market, local companies in order to win in competition,actively improve the technology, realizing the upgrade products.Foreign companies reduce costs in order to expand their marketshare.The theory mentioned above is not enough to come to theconclusion that FDI promote coal industry structure upgrade, so inthird part, the vital point of this article focus on the foreign empiricalanalysis of the industrial structure upgrade, the empirical partadopts the regression analysis, using a mediation conduction model, The per capita FDI as intermediate variables. Be explained variablesproposed for special equipment manufacturing output per head,explanatory variables for the level of mechanization of coal industry,this paper, the labor productivity of the coal industry replace thelevel of mechanization of coal industry, Intermediate variable for percapita of FDI. In addition to make up for the foreign domesticcompetition mechanism in the lack of empirical, we take the heavymachine company as an example the case analysis.Through the preliminary empirical analysis above, coalproductivity effects capita FDI significantly, while coal productivityalso promoted the output of special equipment manufacturingindustry. But per capita FDI as the mediation role made a less effect,on one hand, the lack of data, no divisions of FDI, not accurateanalysis. On the other hand, foreign investment in Shanxi is relativelysmall, so the effect of FDI is smaller.