Research Article
Study on the Flow and Determinants of Foreign Direct Investment in Guangdong Province - Based on Fixed effects Panel Model
@INPROCEEDINGS{10.4108/eai.18-11-2022.2326882, author={Xiling Wu and Meiqi Zhang and Man Xie}, title={Study on the Flow and Determinants of Foreign Direct Investment in Guangdong Province - Based on Fixed effects Panel Model}, proceedings={Proceedings of the 4th International Conference on Economic Management and Model Engineering, ICEMME 2022, November 18-20, 2022, Nanjing, China}, publisher={EAI}, proceedings_a={ICEMME}, year={2023}, month={2}, keywords={hausman test; cointegration test; panel model; foreign direct investment; flow distribution}, doi={10.4108/eai.18-11-2022.2326882} }- Xiling Wu
Meiqi Zhang
Man Xie
Year: 2023
Study on the Flow and Determinants of Foreign Direct Investment in Guangdong Province - Based on Fixed effects Panel Model
ICEMME
EAI
DOI: 10.4108/eai.18-11-2022.2326882
Abstract
Guangdong Province, as the main force of reform and opening up, was one of the first regions in China to use foreign investment. This paper takes 21 prefecture-level cities in Guangdong Province as an example to analyze the flow of foreign direct investment and the distribution of industries. The stationary of the data is tested by LLC test and IPS test, and then the cointegration test reveals the existence of a long-run equilibrium relationship between the variables. The F-test and Hausman test, on the other hand, indicate that a fixed effects model should be used for model construction. The regression results found that the flow direction of foreign direct investment in Guangdong Province exhibits a highly uneven distribution under the combined effect of various factors, among which, the level of economic development and industrial structure have a positive driving effect, while infrastructure construction, industrial agglomeration, and labor price have a negative change in foreign direct investment.