An Empirical Study on the Influence of FDI Spillover on China's Innovation Capability

Using China's inter-provincial panel data from 1999 to 2008,this paper empirically tests the influence of foreign direct investment(FDI) spillover on the innovation capacity of China.The findings indicate that FDI produces an obviously positive spillover effect on China's innovation capacity,but the spillover effect is mainly reflected on exterior design and the number of new utility model patent authorizations,with no obvious spillover effect being seen on the quantity of invention patent authorizations.The further analysis shows that the spillover effect of FDI on the exterior design and new practical innovation capability in the eastern and middle areas is more significant while the effect in the western area is not obvious.