Analysis of Crowding in or out Effect of FDI on Domestic Investment

Abstract: FDI and domestic investment (domestic private investment, public investment) is momentum of promoting economic growth, and the domestic investment is the most important sources of economic growth. FDI as exogenous variables has always been a "double-edged sword" in domestic economic, FDI will promote economic growth, and meanwhile FDI maybe has the negative effect in china. By reconstructing the absolute crowding in or out model, the author use larger sample of panel data to explore the long term relationship between FDI and domestic investment in china from country level and regional level. In addition, we try to search after the theory mechanism 、 practical causes of the crowding in or out effect in china. Lastly, the countermeasures for crowding-out effect are given with analysis…
Key words: Foreign direct investment; Crowding–out effect; Crowding-in effec

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