The Study Of Impacts Of Fdi On China’s Industry Enterprises’ Independent Innovation

Economically backward countries can develop its own economy by the way of attracting foreign investment and obtaining advanced technology. The cost may be low, but with the development of the countries’economy, the countries must rely on their own independent research and development and technological innovation if they do not want to always lag behind other countries. Technological innovation can lead to the rapid development of economy. Developing countries acquire more advanced technology through foreign direct investment, when their capacity for independent innovation are weak, so as to continuously cultivate and improve their own ability. However, the substitution effect cannot be ignored. Therefore, our analysis of the impacts of FDI on independent innovation of industry enterprises has some significance.According to existing research, the impacts of FDI on independent innovation are in dispute. Based on the review and combination of existing research and analysis of the mechanism that FDI on independent innovation through technical and non-technical channels, the author analyzed the current situation of FDI and independent innovation of industry enterprises. The author also analyzed the periodic impacts of FDI on independent innovation in the case of Automobile industry. Furthermore, we carried on the empirical analysis of the impacts of overall FDI on independent innovation of China’s industry enterprises, enterprises of different scale and enterprises in different regions, and that different sources of FDI on independent innovation of China’s industry enterprises. Finally according to the result of theoretical analysis and empirical analysis, the author put forward some suggestions to promote Chinese industry enterprises’independent innovation.The research results indicate that:(1) FDI can hardly promote the R&D investment of China’s industry enterprises;(2) FDI has both positive and substitution effects on independent innovation of China’s automobile industry;(3) the impact of overall FDI on China’s innovation is positive but obviously less than R&D, and there is a certain degree of substitution effect between FDI and R&D;(4) the smaller the enterprises are, the less impacts exist. there is substitution effect between FDI and R&D in large enterprises, which has a negative effect on independent innovation. R&D is not effective to absorb foreign technology in the medium and small industry enterprises;(5) the impact of FDI on independent innovation of industrial enterprise in eastern and northeast region is positive, which is not exist in central China and negative in western region. There is substitution effect between FDI and R&D of industry enterprises in eastern region, which has some negative influence;(6) investment from Hong Kong, Macao and Taiwan does not have impact on the independent innovation of China’s industry enterprises which investment from other countries has positive effect on, but there is substitution effect between investment from other countries and R&D of China’s industry enterprises.