An Empirical Study on the Relationship between the Use of FDI and Economic Growth in Jiang-su

This paper establishes a measurement model on the basis of FDI theory and theory of economic growth. By using this model, this paper not only analyses the positive corelation between the use of FDI and economic growth in Jiang-su Province, but also explores how FDI affects economic growth. Major conclusions include: FDI relative size and economic growth is significantly relevant, economic growth is the Granger reason of FDI relative size but it is not right in turn; FDI affects economic growth through the ways of physical capital, technological advances, changes in the industrial structure as well as foreign trade; FDI does not affect economic growth through the way of human capital. Based on above conclusions, this paper gives some suggestions in the end.