The Spillover Effects of Foreign Direct Investments on Innovation in China

This study conducts quantitative analysis on the spillover effects of Foreign Direct Investments (FDI) on innovation in China as well as the heterogeneous effects of various innovation types in the eastern, central and western regions.An OLS model employing the panel data from 2005 to 2014 of 30 provinces in China is built.It is found that FDI improves innovation significantly in the nation in general, especially in the eastern and western regions.However, the spillover effects disappear in the central region.Moreover, the promotion effects of FDI on design patents granted by region are much larger than those on utility model patents and invention patents.In the western region, FDI has significant positive effects on all the 3 types of patents.And these effects are all greater than those in the eastern region.