The Impact Of Differences In Absorptive Capacity On The Technology Spillover Effects Of Foreign Direct Investment In China

Though the global rank of China’s FDI has dropped from first to third,it still maintained a steady growth.The inflow of foreign capital not only brings the host country sufficient capital,but also brings advanced technology and management experience.However,due to the imbalance of regional development in China,there are obvious regional differences in the effect of technology spillovers of FDI.FDI not only brings positive spillover effects to China,in some areas,it may crowd out economic activity.Many scholars tried to explain this phenomenon from the perspective of absorptive capacity,They propose that the FDI spillover effect is strong in the region with strong absorptive capacity,while it is very limited in the areas with weak absorptive capacity.Firstly,this paper reviews the concept of absorptive capacity.Refer to the study of division for-FDI absorption capacity and proxy of Jin Yanqing and Lu Xiaoyong,the absorption ability is divided into three levels of contents:the technology absorptive capacity;the institutional absorptive capacity;the basic absorption capacity.Secondly,this paper analyzes the current situation of China’s foreign direct investment as well as the status of absorptive capacity.The current research tend to choose a single index or multiple indicators as alternative indicators of absorptive capacity,and ignore the synergy between the various factors of absorptive capacity.So this paper build a comprehensive index of absorptive capacity,then analyzes the current situation of China’s FDI technology spillover capacity.At last,this paper analyzes the influence of absorptive capacity on FDI technology spillover.The empirical study analyses the threshold effect of comprehensive absorption capacity index and the influence factors.The empirical results show that the absorptive capacity of China’s FDI technology spillover has a double threshold effect,and the difference of absorptive capacity lead to the regional differences of the spillover effect.We can see that in the year 2013 all region of China has across the the first threshold value,and only the eastern region across the second threshold.In order to further improve the level of FDI spillovers,we need to further enhance the absorptive capacity.While paying attention to the improvement of absorptive capacity,we also need attach importance to the synergistic development of the various factors of absorptive capacity.