Study On The Effect Of FDI On The Industrial Technology Innovation In Fujian

With the status of foreign capital rising in the international market, academic circles pay more attention to FDI technology spillover effect at home and abroad. Previous studies shows that the spillover effect of FDIis significantly different in different countries or regions, some countries or regions shows positive, others may negative. As a province attracting large number of foreign capital in China, Fujian economy has been developing rapidly since reform and opening up. But facing the pressure of the global knowledge economy, Fujian should urgently upgrade its economy and promote the construction of "an innovative-type province on the west side of the Straits". Therefore, matching the Fujian strategic target ofbecoming an innovative province, this paper puts forward "the effect ofFDI on the industrial technology innovation in Fujian" as the subject, attempts to analyze whether FDI promote the industrial technology innovationin Fujian or not.This paper reviews the literature researched on the FDI technologyspillover effect, summarizes the methods and research priorities of the existingliterature researches. On that basis, it states that the effect of FDI on theindustrial technology innovation should be distinguished from the FDItechnology spillover effect. Next it analyzes the FDI technology spillover effectbriefly, and elicits the mechanism of FDI effect on industrial technologyinnovation, in order to provide the theoretic basis for the following empiricalanalysis. Then it goes on massive collecting related data about the FDI andtechnology innovation in Fujian industry, researches on the present status.Subsequently, this paper uses two indicators "new product outputs" and"patent applications" to measure the output of industrial technology innovation,and constructs distributed lag effects models respectively, uses the “laborproductivity” to measure the industrial technology innovation effectiveness,and conducts an empirical panel-data analysis. This paper comes to theconclusion that the outstanding achievement of Fujian FDI is leading in China,but the technology innovation is marginalized seriously. FDI technologyspillover is on the lower level mostly, it squeezes out value innovation products while promoting the patent applications. FDI gives a boost to the wholeindustry labor productivity, has a positive effect on technology advancement,but has an adverse effect on developing new and high technology industries.Finally, it brings forwarder some proposals on how to utilize more foreigninvestments in a better way to improve Fujian industrial technology innovationfrom the nation level, industry level and corporation level.