Research On Technology Spillover Effects Of FDI And Business Groups In China

In a long time,China has implemented the strategy of c"market-for-technology".The goal is to attract foreign direct investment by opening up the domestic market and improve the technological development and international competitiveness of Chinese enterprises.As China has become the world’s second largest country to attract foreign direct investment,it’s a good question to know whether the strategy of“market-for-technology”is successful,whether China’s enterprises acquire technological innovation resources through FDI,and enhance innovation capability.As one of the important aspects of China’s economic reform,the formation of business groups plays a unique role in the reform of state-owned enterprises and the establishment of moderm corporate systems in China.It’s a good topic to know the Chinese business groups impact on innovation.At present,FDI and business groups is regarded as a good way for Chinese enterprises to obtain technological resources.The essence of technology spillover effect of foreign investment and business groups is that enterprises obtain technology resources through internal and external markets.At the same time,FDI and business groups are not isolated from each other,and there is an interaction between the two.This paper explores technology spillover effects of FDI and business groups,analyses corporate innovation performance from the perspective of technology spillovers.Firstly,the paper reviews the related literatures on technology spillover effects of FDI and technology spillover effects of business groups and relevant assumptions are proposed.In terms of empirical analysis this paper uses the panel data and patent database of industrial enterprises from 2002 to 2010 to conduct empirical research on the technology spillover effects of FDI and business groups at the city level.The results show that FDI and business groups at the city level have positive and significant technology spillover effects on the innovation performance of enterprises.The technology spillover effect of FDI is more obvious when the intensity of business groups is weak,the level of intellectual property protection is high,the degree of economic openness is high and the score of financial ecological environment is high.The technology spillover effect of business groups is more obvious when foreign capital is introduced into the groups,enterprises is belong to subsidiaries,the level of protection of intellectual property rights is high,the degree of economic openness ishigh and the score of financial ecological environment is high.Finally,policy recommendations are as follows:The Chinese government should establish an incentive and innovation mechanism,establish an appropriate and effective intellectual property protection system,improve the level of opening-up and improve the financial ecological environment in order to cultivate an innovative spillover environment to FDI and business groups.