Study on the Relationship of Domestic Investment Area Gap, FDI Area Gap and Economic Steady State Growth

Abstract: Classical economic and Neo-classical growth theory both have affirmed the important effect of capital accumulation on economic growth. The effect that the gap of invest has on the economy steady increasing is also more and more obvious . I will study the relation between the foreign capital gap, the domestic invest gap and economy steady increasing, finding out the route of realizing economy steady increasing and optimum inner foreign capital area gap.The investing gap can be divided the absolute gap and the relative investing gap. I adopted the relative investing gap, and established the measurement standard with investment of gap, used the coefficient of differentiation to judge the investing gap. Because the impact of FDI gap and domestic investment gap has the different effect on the economic increasing, so I separate the two as independent variables.According to the theory on the invest gap and economic steady increasing, I improved Solow economic growth model, Romer and Lucas economic growth model, made a series of basis hypothesis, set the theory model on the investing gap and economy increasing, got the satisfied expression condition of FDI investing gap and domestic investing gap when it reached economy steady increasing,and made the conclusion that the optimal gap exists, but not unique. According to Phelps golden rule, I got the optimum capital accumulating proportion. The conclusion is: In the all route of realizing economy balanced growth, for keeping consumption maximizing, we should make the capital effective marginal productivity meet the dependence of the labor productivity, technological progress, depreciation rate and the FDI and domestic invest proportion.According to the investing gap in our country, I analyzed the factors that bring the investment area gap: policies, the area place factor, the current economical environment. Using our relevance data, I made the concerning analysis , discovering that the relation of GDP gap and the FDI gap, domestic invest gap is appraising .By the quantitative analysis, I got the impact of invest gap on the economic increasing gap. From the impact of consume demands, technological progress, import and export and employment on the economic growth, I analyzed the invest gap effect mechanism on our country economic growth, seeking the route of improving invest gap. And from "two tax-in-one " effectuation, I found the route and policy choosing to realize the best investing gap and economy steady increasing in our country: Improving the backward areas investment climate actively is the basic measure, enlarging science and technology input and development of human resources is an assist aided means, the macro-controlling for building impartial environment of competition is to go further…
Key words: FDI Gap; Domestic Investment Area Gap; Solow Growth Model; Econometric Model

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