The Research On FDI Technology Spillover And Its Threshold Effects

Since 1980's,with the upsurge of economic globalization,many countries especially developing counties have formulated various incentive policies to stimulate or encourage foreign investors to invest.Foreign direct investment(FDI)has become an important source of capital and a significant channel to obtain spillover technology for developing countries.China is one of the main destinations of FDI flows,the use of FDI technology spillover effect to enhance the level of domestic technology or the policy of "market for technology”,is also an important way to achieve independent innovation and technology catch-up.Then,after decades of practice,whether this goal has been achieved,whether Chinese local enterprises from foreign investment get technology spillover,what factors affect the spillovers,what kind of policy to improve the investment environment of our government should take to enhance technology spillover in view of the present situation,will become a major issue which is worthy of further study.Based upon a panel data model,the paper focuses on the province-level spillover effects of FDI inflow in China.As being expected,it confirmed that FDI affects the local technology progress differently in different provinces.In the three municipalities and Jiangsu,Zhejiang,Guangdong as the representative of the southeast coastal areas and Hunan,Hubei as the representative of the central regions,the inflow of FDI has positive spillover effect,it also shows that the introduction of foreign capital has improved economic development and technological progress for the above areas.Hebei,Shanxi as the representative of the western region and Xinjiang,Shaanxi,Yunnan as the representative of West China,the inflow of FDI does not reflect the significant technology spillover effect,even impacts economic development and technological progress in these areas.On this basis,the paper uses "Threshold Regression" to construct nonlinear panel data model to test the threshold characteristics of factors which influence FDI technology spillover.The results show that the technology spillover effect and the local economic development level,opening degree,absorptive capacity of domestic funded enterprise are monotonically positive correlation,but when these indicators at or above a certain level,the technology spillover effect will show a significant leap,which shows that the technology spillover effect of FDI has obvious single threshold characteristics.At the same time,the test results show that the technology gap between domestic and foreign enterprises in a region for the impact of FDI technology spillover has non-monotonic double threshold characteristics,only when the technology gap is within a moderate range,can positive technology spillover be produced.The lack of or too large technology gap between domestic and foreign enterprises will affect the technology spillover of FDI.Finally,the paper provides some policy recommendations to improve the investment environment and enhance the technology spillover effect.