FDI, domestic capital and economic growth: Evidence from panel data at China's provincial level

Changyuan Luo ()
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Changyuan Luo: Center for European Studies (CES), Fudan University, Shanghai 200433, China; China Center for Economic Studies (CCES), Fudan University, Shanghai 200433, China

Frontiers of Economics in China-Selected Publications from Chinese Universities, 2007, vol. 2, issue 1, 92-113

Abstract: Based on panel data at the provincial level in China, this paper found that direct effects foreign direct investment (FDI) had on economic growth were of insignificance. However, through improving technical efficiency and crowding in domestic investment, FDI produced positive effects on China's economy. The state sector still played a major part in the total fixed investment, therefore, direct effects on growth were significant. Although private sector was increasingly important for the whole economy, it had no direct influences on economic growth. Meanwhile, neither the state sector nor private sector made contribution to the improvement on technical efficiency.

Keywords: FDI; economic growth; TFP; capital accumulation (search for similar items in EconPapers)
JEL-codes: C33 F21 O47 (search for similar items in EconPapers)
Date: 2007
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Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:fec:journl:v:2:y:2007:i:1:p:92-113

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