Study On Factors Of Influencing Chinese Service Industry Using FDI

With the Chinese service industry gradually opening up,the service industry has been rapid developed,the scale of the service FDI is also expanding,and more than the manufacturing sector,becoming the main industrial sectors of attract foreign direct investment.Foreign direct investment in service industry can promote the development of service industry in the host country through capital,technology and management,which is embodied in employment effect,technical effect and growth effect.At this stage,the development level of service industry in China is low,the utilization of foreign direct investment of service industry in depth and breadth to be improved.Based on this,this paper attempts to analyze factors that influence attracting FDI on the Chinese service industry and gain the main results.Then,we can give some reasonable suggestion when the government make policy to improve the quality and level of foreign capital in service industry,further to promote the long-term healthy development of Chinese service industry.Based on the previous research,we arrange systematically factors of influencing foreign direct investment in the service industry,and from the three aspects of demand factors,supply factors and market environment factors detailed analysis of FDI location choice behavior.Then,using the panel data of 23 provinces and cities in China in 2004~2014,this paper empirically tests the influencing factors of China's service industry to attract FDI.Then,through the empirical analysis of sub sectors and sub regions,this paper studies the impact factors of service sector segmentation and China's regional development differences on China's attracting service FDI.The empirical results show that:(1)from the overall service industry,manufacturing FDI,degree of market size,labor cost,service industry development level,the level of opening up,government intervention in the economy are the main factors affecting the service FDI,Among them,the manufacturing FDI,market scale,service industry development level,labor cost and opening up level have a positive impact on the inflow of FDI in service industry,the extent of government intervention in the economy has a negative impact on the inflow of FDI in the service sector.(2)from the point of view of subdivision industry,Manufacturing FDI,the size of the market,the development level of service industry,labor cost,human capital,the level of opening up has positive effect on the FDI production service industry and the manufacturing industry FDI,market size and growth potential of the market,the development levelof service industry,human capital and the level of opening up have a positive impact on the inflow of FDI in non productive service but the degree of government intervention in the economy has a negative impact on the inflow of FDI in the nonproductive service.(3)from the analysis of different regions,the manufacturing FDI has a positive effect on service FDI in the eastern and western regions,but there is no relationship between them in the central region;the labor cost of service industry has positive effect on service FDI in the eastern and central regions,but has a negative effect in the western region;In addition,the service FDI is affected by the development level of service industry and the construction of infrastructure in the eastern region,and the human capital has a significant service FDI in the central region,and the government intervention has negative impact on service FDI in the western region.