A Research On The Effect Of FDI On LiaoNing's Total Factor Productivity Of Service Industry

In the process of economic development and industrial optimization of developing countries,foreign direct investment(FDI),which makes up the gap with the world market,always plays an important role in capital accumulation and technology communication.FDI,with inherent knowledge and technical advantage,not only plays a leading role in driving the process of economic growth,but also promotes technological progress and technical efficiency.Under China's New Normal track background,the economic growth model of China changes from high-speed to medium-speed,which requests a higher economic demand,including the change of economic driving force,more general economic welfare and allocation of resources of market-driving,higher contribution rate of services to GDP,etc.The key to achieve this sustained and healthy development is improving the total factor productivity(TFP),releasing the potential space of the invisible elements.Based on this scenario,the analysis on the efficiency of FDI in service industry in Liaoning Province and how to promote the improvement of total factor productivity in the service industry should be of great theoretical significance and practical value.Firstly this paper tells the research significance and background,summarizes the domestic and foreign experts' in related field viewpoints and shortcomings.Besides,this paper gives the definition of the service industry and describes its characteristics,finally makes some exploratory research on the status quo of the service industry in Liaoning Province according to the several FDI economic effect mechanisms for service industry.The core part of this paper is based on the relationship between FDI and service industry TFP as the main research object.Through the random frontier function(SFA)method,this paper take the data of 14 prefecture-level cities in Liaoning Province during the 2001-2015 year as the panel sample,decomposing total factor productivity into technological progress and technical efficiency.Then this paper use redundant analysis(C2R-DEA)model as the supplementary analysis to evaluate the relative effectiveness of the input factors of service industry under the current input and output scale.Finally,according to results of this paper,it is pointed out that the technological efficiency and technological progress of the main areas and the total factor productivity are the trend of increasing around the Shen Yang and Coastal economic zone in Liaoning Province from 2002 to 2015,besides there is quite a few inefficiency exists with the increase of FDI in the service industry.Thus,this paper puts forward some policy suggestions on how to conduct the potential of the invisible elements of service industry and expand the service industry in Liaoning Province in a better way.The innovation of this paper is that for the first time,this paper uses the stochastic frontier function and data redundant analysis to make a quantitative analysis of the regional technical efficiency,technological progress and total factor productivity in Liaoning Province,and make a comparative study of the effectiveness of factor input.