A Study On The Effect Of FDI On Opportunity-Driven And Necessity-Driven Entrepreneurship

Due to the financial crisis in 2008, the employment situation in China is increasingly severe, and the state proposed a policy called “driving employment by entrepreneurship”. Entrepreneurial activity plays a key role once again. Entrepreneurship has become global issue, gaining increasing attention. However, the entrepreneurship in our country is considered to be very weak while there are more entrepreneurial opportunities. Based on different points of view, entrepreneurship can be distinguished in different ways, in which GEM(Global Entrepreneurship Monitor) divided it into opportunity-driven entrepreneurship and necessity-driven entrepreneurship by the perspective of entrepreneurial motivation.On the foundation of paper study and theory research, this paper firstly has qualitatively compared the characteristics of opportunity-driven and necessity-driven entrepreneurship, and analyzed present status of opportunity-driven and necessity-driven entrepreneurship in China. The conclusion has shown that before 2012 the ratio of necessity-driven entrepreneurship was substantially higher than the ratio of opportunity-driven entrepreneurship in China, while the ratio of opportunity-driven entrepreneurship has exceeded the ratio of necessity-driven entrepreneurship. China achieved the transformation of the type of entrepreneurship in 2012, however the ratio of the opportunity-driven entrepreneurship still needs to be improved. Then, this paper has introduced the theoretical basis of why FDI affects entrepreneurship. Finally, based on the unbalanced panel data of 38 countries or regions participated in the Global Entrepreneurship Monitor(GEM)over the period from 2005 to 2014, this paper has studied the impact of inwards and outwards FDI on the opportunity-driven and necessity-driven entrepreneurship. The results shows that inwards FDI has a negative effect on both the opportunity-driven and necessity-driven entrepreneurship, while outwards FDI has a significant positive influence on the opportunity-driven entrepreneurship and a significant negative impact on the other category of entrepreneurship. The results of this paper have important policy implications on how to guide China's entrepreneurship, and a certain reference value on how to promote the study of the impact of FDI on entrepreneurship...