The influencing factors of foreign direct investment in Chinese Services

In order to test the influencing factors of FDI in Chinese Services, Johanson co-integration test, Granger causality test and error correction model are used in this paper by analyzing the data from 1985 to 2007. The research shows that economic development, services development, FDI in the secondary industry and the improvement of government service efficiency in long run have positive effect on services FDI, which accelerates the development of Chinese economy, services and secondary industry FDI and improves government service efficiency simultaneously; the opening of services, average personal income and labor cost of services have little effect on services FDI, which however hastens the services openness, increasing average personal income and wage level in Chinese services; furthermore, industrial policy, human capital condition, infrastructure have little correlation with services FDI. That provides evidence for accelerating services development by making full use of FDI.