The Influence Of FDI In Industrial Clusters Of Zhejiang Province

Zhejiang Province is located in the east coast. Massive economic and openeconomies are Zhejiang’s economic features and highlights. With the amount of FDIinflows following the growth, scholars began to focus on the relationship betweenZhejiang industrial clusters and FDI, and how to use FDI to achieve the rapidescalation of existing industrial clusters.At the same time, more and more studies show that FDI has become animportant basis of cluster development, FDI through capital accumulation, technologyspillover, improve the industrial chain, human capital improvement, a series of waysto promote the formation of industrial clusters to achieve expansion or upgrade. So forthe private economy in Zhejiang Province featuring cities, whether foreign capitalinflows are also able to play a relevant role in promoting, and whether there aredifferences in different industry?This paper adopts a methods which combines the theoretical analysis withempirical verification. Firstly, the paper summarized the theory and define therelevant concepts. Secondly, this paper theoretically analyzes how the FDI impact onindustrial clusters in Zhejiang. Then, the paper provides an overview of FDI inZhejiang status and the status of development of industrial clusters. Finally, the paperestablished econometric models that uses26manufacturing industries panel data ofZhejiang from2001to2011, empirical analysis whether the FDI influences onZhejiang industrial clusters. The empirical results the following conclusions: FDI isconducive of Zhejiang industry cluster formation and development; Private economicimpact of industrial clusters in Zhejiang Province better than FDI; The impact of FDIon industrial clusters has very different levels, the higher is the degree of industryclusters, the greater the impact will be. Positive effect of FDI was Only exist inlabor-intensive cluster.