Abstract

Globalization is a phenomenon with the rap-id growth of international trade and foreign direct investment.Since the aim of foreign direct in-vestment is to construct enterprises which oper-ate in the host country, the effect of foreign di-rect investment is more important.The scale of international trade of the host country will in-cline as the activities of international trade of foreign direct investment enterprises increase.The technology can be improved with the compe-tition and cooperation between foreign direct in-vestment firms and domestic firms.The involve-ment to globalization of China is a focus.There is a great deal of foreign-owned firms in China as foreign direct investment rush

into China.Furthermore, the shares of numbers of firms, assets and employ-ments of foreign economy in China are less than the shares of its activities of international trade and innovation.In the context, it is important to investigate on the foreign economy and its effect quantitatively and the research can boost the progress of foreign direct investment theory.

The dissertation answers a series of questions.What is the foreign econo-my？What is the performance of foreign economy in China？How big is the in-ternational trade when considering the international trade of foreign economy？How is the technology spillover from foreign economy to domestic firms in Chi-na？Does the ownership arrangement of foreign direct investment firm effect technology spillovers？The relationship between foreign economy and domestic economy become clear and some problems in China can be understood in new angle of view by answering these questions.

The dissertation defines the area of foreign economy by summarizing inter-national standards published by international organizations and the concept and statistical structure in them.The author defines the foreign economy as the es-tablishment and operations of foreign firms according to the statistical systems of FDI and foreign firms.The flow of FDI and the confirmation of existence of foreign firms are important in the statistical system of FDI.The operation and activities of foreign firms are the main interests in the statistical systems of firms.Based on the logic of statistics collected by authorities, the author ex-plores the statistical systems of FDI and foreign firms of China.As a result, the existing data for the research of foreign economy in China can be shown.

The author collects the published and unpublished statistics collected from statistical systems of FDI and foreign firms in China and other countries.The dissertation describes the development of foreign economy in China using the measurement of firm's existence and its activities historically and by different categories.The research finds the share of activities of foreign firms in China, such as sale, export and innovation, is higher than the share of number of firms, assets and employment.The scales of international trade and innovation of foreign economy are important for the economic growth in China.

Since the international trade of foreign economy is important in China, the author explores the effect of foreign economy on international trade in China.The method used in statistical system of international trade cannot show the in-fluence on the data of FDI, the author summarizes the substituted methods.Further, Estimators of international trade statistics based on the ownership method are calculated.The results show that the scales of international trade and the net of export and import are not as high as they are shown by the tradi-tional method based on residency.

Since the innovation of foreign economy is important in China, the author explores the effect of technology spillovers from foreign firms to domestic firms in China.The channels and conditions of technology spillovers are summarized to construct the empirical analysis.The dissertation shows the technology spill-overs from different channels quantitatively including completion effect, imita-tion effect, forward linkage effect and backward linkage using firm level data of manufacturing in China.The Multilevel model is used to estimate the parame-ters and test the significance.The results show that it is complex of technology spillovers.The domestic firms can obtain active effect by competition effect.Big firms, small firms and private firms are the benefit, but state-owned firms and firms with innovation cannot be sure whether the parameters are not signifi-cant.The big firms and firms with innovation can obtain active effect by imita-tion, but small firms and private firms seem to be squeezed out.Small firms can obtain active spillovers through forward linkage effect but back linkage effect is positive.

Since foreign firms are mainly wholly-foreign-owned firms, the ownership arrangement of foreign firms may influence horizontal spillovers.The author u-ses both the industry level data from the first economic census and the firm lev-el data from the usual statistics of firms above a defined scale in the empirical analysis.The results show that the spillovers are active through competition and positive through imitation, the active completion effect of wholly-foreign-owned firms are less than the whole foreign firms and the positive imitation effect of wholly-foreign-owned firms are more harmful than the whole foreign

firms.

In a word, foreign economy is the topic of this dissertation.The author u-ses almost all available data in national statistical system.The research on the influence of foreign economy provides new quantitative evidence to view the in-ternational trade, technology spillovers from FDI and the effect of wholly-for-eign-owned firms in China.

Key Words：foreign economy；international trade；technology spillo-vers；wholly-foreign-owned firms；multilevel model