Empirical Analysis of the Effect of Foreign Direct Investment and Export Trade on the Economic Growth of Zhejiang Province

Based on the statistics of the actual foreign direct investment (FDI), export trade and regional gross national product of Zhejiang Province of 1986-2008, this paper carries on empirical analysis using cointegration test and error correction model. The results show that, in the long run, in Zhejiang Province, FDI and export has long equilibrium relations with the economic growth and FDI and export trade promote the economic growth obviously. In the short run, deviation happens between the FDI, export and economic growth, but the deviation error correction speed is fairly fast.