The Research On Influence Factors Of Foreign Direct Investment In Six Central Provinces(2000～2014)

Since the 21 st century, trade between China and the rest of the world becomes more and more frequent. Foreign direct investment(FDI) is gradually playing an important role in economic development. Six Central Provinces, namely Anhui, Hubei, Henan, Hunan, Jiangxi and Shanxi, are located in the inland regions of China, which are economic hinterland and valuable markets with a large population, and they also provide the bridge for eastern and western regions. However, because of various factors, the distribution of FDI is very uneven, which means the utilization of FDI in eastern region is higher than central and western regions. The Central Committee of the Communist Party of China proposed to promote the rise of the central region in 2004, which brought new opportunities for Six Central Provinces. Rely on the support of national policy, Six Central Provinces made a lot of effort on attracting FDI in recent years, and the result was very significant, for example, in 2014, the proportion of actually used foreign investment among Six Central Provinces are 57.268 billion dollars, which is as 17.13 times as that in 2000. It is worth exploring which influence factors cause the increase of FDI in Six Central Provinces over the past 15 years and the effects of these influence factors in attracting FDI.Based on previous research, the article use panel data and choose eight influence factors which are gross domestic product, human resource, average wage, fixed asset investment, traffic capacity, total volume of import and export trade, industrial structure and governmental efficiency. The econometric model is constructed to do the research on influence factors of foreign direct investment in Six Central Provinces.First, the article expounds the research background and research significance, and explains the reason why the article does the research on influence factors of FDI in Six Central Provinces over the past 15 years. Then the article introduces researches and literature reviews about factors which can influence Six Central Provinces’ FDI at home and abroad, and summarizes main influence factors of FDI. After that, the article elaborates the current situation of foreign direct investment among Six Central Provinces, including the change of total amount and structure and the advantages and the limitations of foreign direct investment. After that, the article builds econometric model and explains the selection standard of dependent variable and independent variables. At the same time, the article forecasts the influence of each factor and illustrates the data source. In the eight influence factors, except the average wage and governmental efficiency, the other factors have positive effect on FDI. All original data comes from 2001-2015 China Statistical Yearbooks, Statistical Yearbooks of the six provinces and The National Economy and Social Development Statistics Bulletin. The article uses Stata13.1 to do unit root test and multicollinearity test with the original data. Then the article uses generalized least squares to obtain the regression equation. According to the regression equation, the article analyzes each factor’s influence on Six Central Provinces’ FDI. At last, the article summarizes the influence factors of FDI in Six Central Provinces, and gets some enlightenment about FDI in Six Central Provinces combining with previous research. At the same time, the article looks forward to the research result.By the research the article finds that the eight influence factors show different significant impact on Six Central Provinces’ FDI, but the situation in each province is different. The influences of factors, except the traffic capacity, are consistent with expectation. Taken together, gross domestic product, average wage and governmental efficiency have larger impact on Six Central Provinces’ FDI.