Abstract

Spatial Econometrics is the frontier of research focus of econometrics in recent years. The theory mainly expands the spatial correlation of economic units and is applied in new economic geography. Foreign Direct Investment（FDI）has been the hot issue of international trade in the past years. In China，the extremely uneven distribution of FDI largely restricts the development of regional integration. Therefore，the research on the spatial structure of FDI in the use of spatial econometric models is not only the methodological innovation，but also satisfies the practical needs. The conclusions in the paper would be meaningful to specific FDI policy formulating，which would effectively promote the intra-regional and inter-regional transfer of FDI in China.

This paper systematically reviewed and summarized the basic theory and the main application of spatial econometrics，which is used to analyze the spatio-temporal diffusion structure and the stability of FDI in China. The main body of the paper focuses on the following questions：（1）The wu-hausman statistic was firstly applied to test the existence of core-periphery structure which was proposed by new economic geographers，taking FDI in China as the example. The results indicated that none of the province could be treated as single FDI agglomeration center. However，multi-center structure was detected in China. Three core areas covering Bohai Economic Rim，Pan-Yangtze River Delta and Pan-Pearl River Delta absorbed the majority of FDI in China. Bohai Economic Circle showed three-layer core-periphery structure with double core cities，Tianjin and Qingdao. Besides，there is obvious four-layer core-periphery structure of FDI in the Pan-Yangtze River Delta，from the east to the west. In Pan-Pearl River Delta，the hierarchical spatial structure of foreign diffusion are found，which Guangdong is the core，and Hunan，Guangxi，Jiangxi，F(xiàn)ujian and Hainan are the secondary center which directly connect to the surroundings includes Yunnan，Guizhou and Sichuan. （2）The innovative spatial error correction model and geographic weighted model to analyse the determinants of FDI diffusion. The temporal dynamic adjustment and the spatial differences of these determinants are the focuses. Three different developing stages-initial investment，fast growth and adjustment and stable development-were classified. Geographical factors placed greater impact on the East and Middle，but gradually weakened. The policy’s influence fell step by step，and was more significant on the Middle and West. The comprehensive determinants played important roles in the second and third periods of foreign investment rushing，and were the main impetus for evolution of spatial pattern reconstruction. （3）The spatial spillover from the core and convergence trend to the core was discussed in details. The contact spillover is detected in Bohai Economic Circle，where the spatial spillover decays as the distance from the core increasing. Besides，the converging trend also follows the same rule. Beijing，Shanxi，Hebei and Neimenggu are mainly affected by Tianjin，while the cities in Shandong Peninsula converge to Qingdao more apparently. In Pan-Yangtze River Delta，the path of neighboring spillover was found between the first，the second and the third spatial structure. While between the second，third and fourth level，the administrative hierarchy dispersion is the dominant way. Finally，the outlying areas have significantly convergence trend to the center of the city at all levels. In addition，the hierarchical expansion path in Pan-Pearl River Delta，supplemented by the contact expansion is the spatial transfer of foreign investment from Guangdong to other provinces. What is more，the periphery areas have significantly convergence trend to the center layer by layer，and follow the rules of decreasing speed with distance. （4）The actual economic data was used to test the stability of core-periphery structure of FDI. This is the most innovation in this paper. The critical wage levels and granger causal test statistics indicate that the existing spatial structure of FDI in China remains stable in the short term and the conditions of large-scale gradient transfer has not been met yet. Noteworthy，the trend of small-scale transfer among the cities in different FDI agglomeration zones is obvious in recent years.