Research On The Correlation Between FDI And The Efficiency Of China Automobile Industry

The Chinese reform and opening-up witnesses the rapid development of theChinese automobile industry. As foreign direct investment (FDI) flows into the maindevelopment areas of China, the Chinese automobile industry grows increasinglystronger. With integration of recourses and deepening of professionalism within theseareas, the Chinese automobile industry has already formed six industry clusters. FDIinfluences the automobile industry in various latitudes, and plays an important role inChina’s becoming the world’s biggest country of automobile production and sales.However, the introduction of FDI also brings risks to the Chinese automobile industry,which needs the combined efforts of all enterprises and the government to guide FDIto accelerate the development of the China automobile industry with more efficiency.This thesis focuses on the correlation between FDI and the efficiency of Chinaautomobile industry. The current situation and the introduction of FDI will bereviewed; the measure of industry efficiency will be proposed; the detailed influencesof FDI on the efficiency of the automobile industry will be analyzed in boththeoretical and empirical ways in accordance with the influence latitudes, in whichtime lag is taken into account. Subsequently, the risks brought by FDI into the Chinaautomobile industry will be summarized, so that the strategic alternatives can be putforward in both enterprise and government level.