The Impact Of Fintech Development On China’s OFDI

Since the 21st century,the "going out" strategy has been deepening,and foreign direct investment has played an increasingly significant role in the "going out" strategy.As one of the many factors affecting China’s foreign direct investment,the development of fintech plays an irreplaceable role.Therefore,based on the panel data of 31 provinces and cities,it is of great significance to explore the impact of fintech development on China’s foreign direct investment.In this paper,the digital inclusive financial development index is used as the proxy variable of fintech indicators,and the data of 31 provinces from 2011 to 2019 are selected to study the impact of fintech development on China’s foreign direct investment.In the research process of this paper,the two-way fixed effect model is adopted,and the static panel analysis method is used to add each control variable one by one,include the level of foreign investment,foreign trade,scientific and technological innovation and labor cost,The impact of the development of fintech on China’s foreign direct investment is estimated.The results show that the development of fintech will indeed play a positive role in promoting China’s foreign direct investment.At the same time,the impact coefficient of the level of attracting foreign investment is positive,which also meets the expectation of this paper.Foreign direct investment will produce a certain spillover effect to promote foreign direct investment;The coefficient of r&d investment is positive at the significance level of 5%,which also shows that the improvement of technological innovation ability will promote the development of China’s foreign direct investment to a great extent;The coefficient of labor cost is negative,indicating that the rise of domestic labor cost will encourage enterprises to invest abroad.In terms of heterogeneity test,through this study,it is found that there are obvious differences in the impact of fintech development in different regions on Chinese enterprises’ FDI.Among them,the west is the highest,followed by the northeast,followed by the central and eastern regions.Although the estimation result of the eastern region is also positive,it has not passed the significance test,which may be affected by the characteristics of regional development.Based on the research of this paper,the following policy suggestions are put forward,emphasizing that the role of financial technology in promoting the level of economic development should be strengthened,and the reform of the financial system should be focused on to provide new impetus for scientific and technological innovation.Further optimize the business environment and improve the efficiency of resource allocation.Government subsidies should be strengthened to favor enterprises that invest abroad,and solutions to the financing problems faced by enterprises can be further provided through the establishment of special funds,for example.In addition,we should reasonably guide the development of foreign direct investment,promote the balanced development of regions,release the precipitated production factors of these industries,industries and regions,improve their economic vitality and promote balanced development.