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Foreign direct investment and the development of special economic zones in China : a comparative study of Shenzhen and Zhuhai, 1980-2000

Author: Cheuk-lam Kung
Author affiliations: University of Hong Kong
Publication date: 2004
Dissertation type: 香港大學學位論文
Abstract: A Comparative Study of Shenzhen and Zhuhai, 1980卅000Submitted byKung Cheuk Lam PeggyFor the Master of Arts in China Area Studies at the University of Hong KongJune 2004Since the implementation of the open door policy in 1979, China has moved out of its economic isolation from the world and interacted actively with globalization. The open door policy was initiated by the establishment of Special Economic Zones (SEZs). The basic purpose of the SEZs is to absorb foreign capital. For more than 20 years, the world has witnessed the remarkable growth of China卅 economy. The role of foreign direct investment (FDI) in economic development has become a topic of great scholarly interests. The first two SEZs, Shenzhen and Zhuhai, presented two different scenarios for economic development in southern China. They are similar in historical background and geographical location but different in economic and regional development. FDI has become the key for understanding the difference. This study reveals that FDI was not the main determinant of economic performance in the two SEZs. FDI has greater influence on the growth of the output value of industry and export. However, it has been less influential in the growth of employment and capital construction investment. The thesis suggests that government support and domestic investment are important in affecting the economic development of the SEZs. FDI has contributed to a certain extent, but it is not the only factor in bringing economic prosperity to Chinese cities in the post-reform era.
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