Research On The Impact Of OFDI To China's Independent Innovation Capacity

It's a special period that competition in the global markets is becoming highly intense and China is experiencing a transformation of economy.Raising the capacity of independent innovation becomes one of the important tasks of China in order to consolidate and enhance its comprehensive national strength,as well as promote China's economy developing towards high quality.However,the improvement of independent innovation capability cannot be achieved without the effective deployment and utilization of domestic and foreign independent innovation resources.Outward foreign direct investment is one of the main ways of China “going out”.The companies investing in other country has the right of transnational management and the advantage of internalization.So,it can provide more effective channels for optimizing the allocation of China's independent innovation resources and absorbing and utilizing foreign innovation resources all over the world.Now,the utility of these channels are also continuously improving with the continuous expansion of the scale,host countries,industries and forms of outward foreign direct investment.The improvement of these channels' utility mainly thanks to various effects of outward foreign direct investment,such as technology spillover effects,employment effects and trade effects.Therefore,this paper mainly studies the influence of foreign direct investment on the independent innovation ability of China.It will not only help enrich the existing theoretical results,promote the improvement of China's ability for independent innovation,but also help further optimize the structure of China's outward foreign direct investment and improve the effective of China's outward foreign direct foreign investment.In a word,it has great significance to China's economic development.This paper starts with the analysis of the impact mechanism of outward foreign direct investment on China's capability for independent innovation.The impact mechanisms mainly consists of resource-absorb mechanism,R&D expenditure sharing mechanism,technology spillover or transfer mechanism,and association mechanism.Secondly,combined with the current situation of China's outward foreign direct investment and the current situation ofindependent innovation,it explains the current impact of China's outward foreign direct investment to independent innovation capability of China from the location and the main forms of outward foreign direct investment.Then,combining relevant mathematical models,empirical studies were conducted on the impact of outward direct investment on China's independent innovation capability from the perspectives of outward foreign direct investment and reverse technology spillover effects.The first empirical study use time series model,and the second one use panel model which has been added to the analysis of country differences.The empirical results show that the total scale of foreign direct investment and reverse technology spillover can promote the improvement of China's independent innovation capacity characterized by the number of patent applications,but the effect of them is weak and the effect of reverse technology spillover effect has the national difference.Finally,according to the research results,we mainly put forward countermeasures and suggestions to enhance our independent innovation capacity through outward direct investment path,mainly from expanding the scale of foreign direct investment,optimizing the layout of foreign direct investment,and flexibly selecting the form of foreign direct investment.