Author(s)

Liang Enshuo ¹, Liu Xiaoqi ²

Affiliation(s)

¹ Investment Project Management Institute of Dongbei University of Finance and Economics, Dalian, Liaoning, China
² Nanjing Normal University Giling College, Nanjing, Jiangsu, China

Corresponding Author

Liang Enshuo

ABSTRACT

Is the development of digital economy necessarily beneficial to foreign direct investment (FDI)? Based on panel data of Chinese prefecture-level cities from 2011-2019, the article empirically tests the spatial spillover effects between the digital economy and FDI using a two-way fixed effects model. The results show that FDI inflows between cities have significant spatial correlation, and a city's digital economy development level has an inverted U-shaped relationship with its geographic and economic proximity to urban FDI inflows.

KEYWORDS

Digital economy; foreign direct investment; U-shaped relationship; spatial spillover effect

CITE THIS PAPER

Liang Enshuo, Liu Xiaoqi, Spatial Effects of Digital Economy and Foreign Direct Investment—A U-shaped relationship. Information Systems and Economics (2023) Vol. 4: 30-38. DOI: http://dx.doi.org/10.23977/infse.2023.040205.

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