The Research On Spatial Spillover Effect Of China's Provincial OFDI On Industrial Upgrading

Outward foreign direct investment(OFDI)and home country industrial upgrading have always been hot topics for scholars.Industrial upgrading is particularly important at the present stage of economic transition.While industrial upgrading is difficult and continues to advance,China's OFDI has developed rapidly.Since China implemented the "going out" strategy in 2002,OFDI investment has grown rapidly at an average annual rate of 36%.By the end of 2017,China's OFDI stock ranking rose from sixth in 2016 to NO.2 in 2017,it has already become a major country of OFDI.Based on the above practical background,it is worth discussing whether industrial upgrading can be achieved through OFDI.In addition,from the spatial dimension,there are great differences between urban clusters and non-cluster areas,Eastern and Midwest regions,and the effect of OFDI on industrial upgrading may be different in different regions.Therefore,this paper introduces dynamic and static spatial Durbin model to study the spatial spillover effect of provincial OFDI on industrial upgrading.Based on the theories of OFDI,industrial upgrading and spatial econometrics,this paper uses TL index and CLP to construct the rationalization index and upgrading index of industrial upgrading,and empirically tests the spatial spillover of provincial OFDI to industrial upgrading.In the part of literature review,it summarizes whether OFDI promotes industrial upgrading,the transmission mechanism between them,and empirical methods.It is found that most scholars do not consider spatial correlation,and based on this,the research direction of this paper is determined.In the theoretical analysis,this paper elaborates the transmission mechanism of OFDI to promote industrial upgrading from the two links of factor input and product output.Then in the empirical analysis part,we select panel data of 30 provinces from 2005 to 2016 to construct dynamic and static spatial Durbin model,and put forward hypotheses from three perspectives:spatial spillover effect,long-term and short-term effects of dynamic Durbin model and regional differences,and empirically analyze the spatial relevance of OFDI to industrial upgrading in each province.The conclusions are as follows:Firstly,from the empirical results of the whole sample,the OFDI behavior of each province can not only promote the optimization and upgrading of its industry,but also promote the industrial structure optimization and adjustment of other provinces and municipalities with similar geographical distance and economic development level,with obvious spatial spillover effect.Secondly,from the measurement index of industrial upgrading,the spatial spillover benefit of OFDI to rationalization of industrial structure is stronger than that of industrial structure.Thirdly,from the long-term and short-term effects of dynamic spatial Durbin model,whether TL model or CLP model,the long-term effects are more significant than the short-term effects.Fourthly,from the empirical results of sub-samples of different regions,the results show that the long-term effects of OFDI are more significant than the short-term effects.The difference between regions is obvious.Whether TL model or CLP model,the results of the eastern region are better than those of the central and Western regions.Finally,on the basis of the empirical results,the paper puts forward corresponding policy recommendations from three aspects:promoting the rationalization and heightening of industrial structure,seeking progressive development mode,and reasonably solving regional differences.