Empirical Research On China’s OFDI Promoting Domestic Industrial Structure Upgrading

With the implement of China’s "going out" strategy, especially in 2013, Xi Jinping proposed "Silk Road Economic Belt" and "21st Century Maritime Silk Road", China’s enterprise that "going out" to carry out outward foreign direct investment meet unprecedented develop opportunity. China’s outward foreign direct investment flow reach up to 123.12 billion dollars in 2014, creating a new record, ranking the third in the world for three consecutive years, OFDI has become an important part of China’s foreign economic activities. At present, China is also an important period of transition and upgrading of industrial structure, transformation of economic development mode and adjusting the industrial structure has become first question of our current economic development. So researching about China’s OFDI can promote domestic industrial structure upgrading has a great realistic significance.This paper reviews the related theories of OFDI and industrial upgrading as a research foundation, on this basis, from three angles of motivation of OFDI, industrial linkage and the changing of supply and demand structure study deeply conduction mechanisms of China’s OFDI promoting industrial upgrading. The analysis section of the status quo of China’s OFDI promoting domestic industrial upgrading, firstly selecting the measure of industrial structure upgrading, calculate the index level, and then according to the happening time of major economic events, the 1985 to 2014 is divided into three phases, calculating grey correlation degree of OFDI and industrial structure upgrading in various stages, at last, based on the calculated gray correlation degree, the evolution of China’s OFDI promoting domestic industrial structure upgrading are divided into initial stage, development stage, growth stage of the effect, analyzing the characteristics and effects performance of each stage. In part of empirical analysis, through the establishment of Chenery "standard structure" model, using stationary test, cointegration test, Granger causality test, impulse response analysis, empirical testing if China’s OFDI can promote domestic industrial structure upgrading, getting with the same conclusion with theoretical analysis and analysis of the status quo, making analysis more comprehensive and rigorous. Finally elaborating the research conclusion of this paper, according to the previous theoretical analysis and the level of economic development, from three aspects of the industry selection, location choice and the government role put forward the strategy of OFDI.