Empirical Research Technology Spillover Effect Of Foreign Investment Direct Impact To Economic Growth

The quantity of Foreign Direct Investment (FDI) in china has grown in recent years as the integration of the global economy gathers pace, and so has Hunan province. Especially in the new century, Hunan province has made some achievements in tax, import and export trade, and employment by using FDI, but which are short-term, apparent effects. The technical spillover effect of FDI must be verified in order to fully evaluate its contribution to economy development of Hunan province. Furthermore, how to promote the technology spillover effect of FDI in Hunan province is an effective way to grow the economy of Hunan province sound and fast.This study firstly analyzed the situation of FDI in Hunan province from aspects such as stage of development, regional distribution, and industry structure. It was obviously found from the apparent, related data that FDI improves the economy development of Hunan province well.Then on the basis of above theoretical analyses of the technology spillover effect of FDI and economy development, a model which can estimate the influence of FDI on the local enterprise production was established by referring to Cobb-Douglas function. Taking the investment and output, and FDI quantity of Hunan province as objects, the empirical research of technology spillover effect of FDI was carried out by using Eviews software. The result shows that the FDI in Hunan province produces technology spillover in improving economy development and technology level, but which is limited. The economy development of Hunan province mainly depends on its inputs of capital and labor. FDI plays a positive technology spillover role in secondary and tertiary industries.At final, some suggestions for promoting the technology spillover effect of FDI in Hunan province were proposed according to the empirical research result. On the investment attraction side, the quantity and quality of investment should be all promoted and the potential of FDI is fully exploited. The government should make the related countermeasures in time, guide and optimize the investment structure of FDI, enhance the inputs of education, research, infrastructure construction to improve the investment environment, and encourage the challenge and cooperation. The enterprise should not only make an effort to upgrade self-technology level, but also optimize the level of human capital, and strive for cooperation with enterprises of FDI and research institutes.