Abstract
This study was set out to investigate the linkages between employment, FDI and economic growth of Beijing city, and the mechanism of FDI’s impact on employment and the city’s economic growth. Channels of FDI’s spillover mechanism on employment and economic growth are identified. And based on sixteen district-level data of Beijing city from 2006 to 2017, we use panel data model to test the linkages between FDI, employment and city’s economic growth. Findings show that for the six inner-city districts with well-developed economy structure and city infrastructure, both FDI and Employment have a positive influence on the economic growth; while for the ten outer-city districts, economic growth seems to be fueled by employment and fixed capital investment.
Highlights
Foreign direct investment (FDI) refers to the foreign capital’s direct investment to China’s economy, which is according to the existing investment policies of the host country
The results show that FDI has neither long-term nor short-term effects on economic growth in most countries
Employment and fixed asset investment are significant at 1% statistical level, while FDI is significant at 5% statistical level
Summary
Foreign direct investment (FDI) refers to the foreign capital’s direct investment to China’s economy, which is according to the existing investment policies of the host country. It promotes the development of the host country’s economy and improves the living standards of the people, and has an important impact on the employment of the host country. As an important measure of promoting the development of the domestic economy, FDI plays an increasingly important role in the world economy. In 2003, China introduced more FDI than that of the United States, becoming the world’s largest host country for FDI.
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