Abstract: What kinds of differences exist in the price changes between the outside-controlled industries and the domestically-controlled industries? Are the prices of the former rising higher? Or the latter? These are the important issues concerned by the government and academic circles. Based on the identification of the outside-controlled industries and the domestically-controlled industries, this paper makes use of the data of China’s industrial sector to conduct an empirical study of the differences of price changes between the two. The results show that the average annual price rising rate of the outside-controlled industries is 2.2% lower than that of the domestically-controlled industries, and the price changes of the outside-controlled industries are more average. When the domestically-controlled industries are divided into state-controlled industry and private-controlled industry, it can be found that the average annual price rising rate of the outside-controlled industries is 2.4% and 1.9% lower than that of the state-controlled and private-controlled industries respectively. The study also finds out that the gap of price changes between the outside-controlled industries with stronger foreign capital control and the domestically-controlled industries is more obvious. These findings provide new empirical support for further objective evaluation of the foreign investment policy effect in the new era.

Key words: outside-controlled industries; domestically-controlled industries; price changes; foreign funds