The impact of FDI and technological innovation on eastern, middle and western China’s economics

Using panel data of 30 various provinces and municipalities in China from 1994 to 2003, we analyze the effect of foreign direct investment and technological innovation on three geographical regions in China: the east, the middle and the west. With the fixed effects regression model of panel data, the results show that foreign direct investments in the eastern region mostly have positive effects, however in the middle regions and in the western regions the effect on the economy is not clear. In addition, in accordance with the eastern, the middle and the western regions grouped study. Based on the experimental results, we believe that there is a positive correlation between the FDI technology ldquospillover effectrdquo and the technology innovation.