SPATIAL PATTERNS OF FOREIGN INVESTMENT IN CHINA'S CITIES, 1980-1989

In the 1980s, foreign investment in China's cities experienced a northeastward movement from the southern coast to the central coast, and began to penetrate into inland cities, Foreign investment clustered in coastal delta areas and along the Changliang and Huanghe rivers. To understand these spatial patterns, a linear regression model is established. Cities with better power supplies, seaports, water transportation, communication, and investment incentives provided more favorable locations for foreign investment. Agglomerated cities had a better chance of attracting foreign investment than widely separated cities, with larger cities not necessarily attracting more foreign investment. Regression residuals also are analyzed for insights into spatial trends of foreign investment. Urban foreign investment in the near future probably will continue to accumulate in the coastal delta areas. Provincial capitals likely will be favorable locations for foreign investment that will further penetrate from the coastal areas into interior regions.