Study On The Location Distribution And Determinants Of Foreign Direct Investment In Yunnan Province

According to the national conditions of a country,the rational use of foreign direct investment can promote the economic development of the host country.The practice of using foreign direct investment since China's reform and opening up has confirmed this.By introducing foreign direct investment actively,China has acquired the capital and technology needed for development.These factors,combined with China's rich natural resources and labor force,have contributed to the rapid development of China's economy.However,a country's society and economy continue to change,and its foreign direct investment policies cannot be static.In order to make better use of foreign direct investment,each country or region should keep on studying the use of foreign direct investment in its own country or region,and propose new countermeasures to new problems and new phenomena,so that foreign direct investment can serve the development of the country or region.At this present stage,Yunnan Province is vigorously attracting foreign direct investment in order to increase the use of capital and technology in each city and prefecture in Yunnan Province,to provide sustainable power for the development.For Yunnan Province,the location of foreign direct investment is extremely uneven,and the vast majority of foreign direct investment is concentrated in Kunming City.In order to attract more foreign direct investment into the cities and prefectures in Yunnan province where foreign direct investment is currently small,and to promote the balanced distribution of foreign direct investment in Yunnan Province,the determinants of the location of Yunnan's foreign direct investment must first be recognized clearly.So which factors affect the geographical distribution of foreign direct investment in Yunnan Province? That is,what factors did a body which launched foreign direct investment consider when choosing its location in Yunnan?Therefore,in short,this paper reviews the empirical researches on foreign directinvestment theory,theories related to industrial location selection,and the determinants of the location distribution of foreign direct investment;analyzes the present status of the location distribution of foreign direct investment in Yunnan Province;combines relevant theories with the actuality to select variables and then establish a dynamic panel data model to acquire a empirical analysis of the influencing factors of the location distribution of foreign direct investment in Yunnan Province,and finally makes recommendations.First,this article introduces the realistic background of the topic selection,explains the significance of the research in theory and practice,defines two important concepts for later research,and introduces the research method and technical route of this article.Then this part summarizes main content and analyzes the innovations and deficiencies of this paper.Second,this paper introduces the theory of foreign direct investment and theories related to industrial location selection,reviews the empirical research on the determinants of the location distribution of foreign direct investment,and then makes some comments on those relevant theories and empirical studies combined with the subject of this article.Third,this article analyzes the overall situation of foreign direct investment in Yunnan Province from the total amount and changes of foreign direct investment,the countries or regions of origin,and the industry entered.Then this article analyzes location distribution of Yunnan Province from the total amount and changes of foreign direct investment of cities and prefectures.Fourth,in order to make the research results more accord with the facts of Yunnan Province and the conclusions more convincing,this paper conducts an empirical study on the determinants of the location distribution of foreign direct investment in Yunnan Province.Based on the research review and the analysis of present status of the location distribution of foreign direct investment in Yunnan Province,this paper selects Market Scale,Transportation Infrastructure,Economic openness,Degree of Industrial Agglomeration of the Three Industries,Labor Price,and other variables to establish a dynamic panel data model with foreign direct investment in each city or prefecture as explained variable,in consideration of the cumulative effect of foreign direct investment,based on the use of data from year 2001 to 2018.The empirical analysis results show that the Market Scale,Degree of Industrial Agglomeration of the Primary Industry,Degree of Industrial Agglomeration of the Secondary Industry,and the Degree of Industrial Agglomeration of the Tertiary Industry have a significantpositive influence role on the location distribution of foreign direct investment in Yunnan Province,and the Labor Price has a negative influence.The impact of Transportation Infrastructure and Economic Openness on the location distribution of foreign direct investment in Yunnan Province is not significant.Finally,this paper draws conclusions and proposes four suggestions are for Yunnan Province to make better use of foreign direct investment and promote the balanced distribution of foreign direct investment in Yunnan Province,with consideration of the actual situation of Yunnan Province: 1.Expand the sources of foreign direct investment and optimize foreign direct investment Investment structure;2.The investment promotion policy should favor cities and prefectures with low foreign direct investment;3.Take advantage of industrial agglomeration effects of development zones to attract foreign direct investment;4.Rely on advantages in labor price to undertake transformation of labor-intensive industries.