The Influence Of Foreign Direct Investment On China's Outward Foreign Direct Investment

In recent years,China has entered a new normal of economic development.The "go out" strategy has attracted unprecedented attention in China and China's outward foreign direct investment has developed rapidly.In 2016,China's outward foreign investment has exceeded the foreign investment in China and China has become a net capital outflow country.However,there is serious asymmetry between OFDI and IFDI in China.And,China's outward foreign direct investment compared with the United States and other developed countries still have a large gap.As two important economic characteristics of China--foreign direct investment(IFDI)and outward foreign direct investment(OFDI)-deserve our indepth study.Basing on these two economic characteristics,this paper studies the promoting effect of foreign direct investment on China's OFDI,and probes into the influencing mechanism of IFDI on OFDI.Basing on the research results,relevant policy suggestions are put forward to guide China how to effectively use foreign direct investment to promote the "going out" of domestic enterprises.From the perspective of research significance,this paper studying the influence of foreign direct investment on OFDI,on the one hand,it enriches existing theories on international investment behavior and explores the influencing factors of foreign direct investment from a new research perspective.And on the other hand,it grasps the current economic characteristics of China and provides some reference and thinking for China's OFDI.This paper adopts the method of combining theoretical research with empirical research.First,conduct a descriptive statistical analysis about IFDI and OFDI development in China.Then,basing on the existing theory,use the 13 years panel data of 30 provinces in China to test the hypothesis.And the fixed effect test model etc was used to test the existence of IFDI's influence on OFDI.When studying the influencing mechanism of IFDI on OFDI,the regulatory effect model and the mediation effect model were respectively adopted to verify the proposed research hypothesis.The article is divided into five parts.The first chapter,introduction.This part mainly introduces the background and significance of the research,the research framework and research methods of the paper,as well as the related literature review and the innovation of the paper.The second chapter mainly describes and analyzes the status quo of foreign direct investment and outward foreign direct investment in China.In chapter 3,basing on the existing theoretical basis,the panel data of 30 provinces from 2004 to 2016 were used to test the existence of the positive influence of foreign direct investment on OFDI.The fourth chapter is based on the third chapter to study the influencing mechanism of IFDI on OFDI.In this chapter,by adding two regulatory variables,human capital and financial development level of each region,it is found that the regulatory variable has a positive regulating effect on IFDI and OFDI.The paper also found that IFDI had a positive effect on OFDI by adding two mediating variables,namely total factor productivity and R&D density in each region.Chapt5,conclusions and recommendations.On the basis of the previous chapters,a summary overview of the paper is made and corresponding policy recommendations are put forward according to the research results.Through empirical research,this paper found that foreign direct investment had a positive promoting effect on outward foreign direct investment in China.When the sample was divided into eastern,central and western parts for further testing the existence of IFDI's influence on OFDI,it was concluded that the positive effect of IFDI on OFDI in eastern regions was much higher than that in central and western regions,which further proved that IFDI's influence on OFDI was affected by the degree of economic development.In the study of the influencing mechanism of IFDI on OFDI,it was concluded that the regional financial development level and human capital status had a promoting effect on the positive effect of IFDI on OFDI.As the mediating variable,the total factor productivity and R&D density in the region had only a partial mediating effect on IFDI,while IFDI had a significant direct effect on OFDI.Therefore,through the study of this paper,it is suggested that while China is actively introducing foreign direct investment,it is necessary to recognize the impact of regional economic characteristics on the positive promoting effect of foreign direct investment on OFDI.Therefore,the government should create a favorable soft and hard environment,improve China's independent innovation ability and technology absorption ability,and enhance China's ownership advantages of foreign direct investment.Although in this paper,through the different angle to study the effect of foreign direct investment on China's outward foreign direct investment,using the stock of foreign direct investment in each province and the provinces the flow of outward foreign direct investment to study the existence of IFDI's positive influence on OFDI,at the same time,the influence mechanism of IFDI on OFDI was studied by adjusting variables and mediating variables.All these have a certain degree of innovation.However,there are still some deficiencies in this paper,such as shorter data years,less control variables and less thorough theoretical analysis.