Location Determinants of China's Outward Foreign Direct Investment

Yao, Shujie; Zhang, Fan; Wang, Pan; Luo, Dan

doi:10.1111/cwe.12218

Cited by 24 publications

(13 citation statements)

References 38 publications

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“…On the other hand, exporting these resources can cause a country to rely too heavily on its natural resources, hindering its long-term economic growth, as the resource curse hypothesis posits. Furthermore, some scholars hold the viewpoint that natural resource seeking is one of the motivations of China's ODI [27,28,[30][31][32][33]. Therefore, excluding this variable would bias the estimation.…”

Section: Control Variablesmentioning

confidence: 99%

“…Particularly, FDI from Chinese firms has increased substantially in the recent past [26]. Chinese MNCs, because of their strong demand for natural resources, are often eager to invest in countries with relatively abundant natural resources [27][28][29][30][31][32][33]. Is it possible that those countries would blindly rely on China's natural resources demand, ignore the need for institutional development, and ultimately fall under the "resource curse" syndrome?…”

Section: Introductionmentioning

confidence: 99%

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Does China’s Outward Direct Investment Improve the Institutional Quality of the Belt and Road Countries?

et al. 2020

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This article investigates the effects of China’s outward direct investment (ODI) on the institutional quality of the Belt and Road (B&R) countries. Based on a panel data set of 63 B&R countries during the period 2003 to 2016, we find that China’s ODI improves the institutional quality of B&R countries not only in the short run but also in the long run. Further, although China’s ODI exerts no differential impacts on host country institutional dimensions of “control of corruption,” “government effectiveness,” and “political stability” in countries with different natural resource endowments, it improves their institutional dimensions of “regulatory quality” and “rule of law,” implying that China’s ODI may help the host B&R countries minimize the “resource curse”. As one of the most important strategies for China’s opening-up development in the current era, the B&R initiative serves as means to promote sustainable development of B&R countries. The article therefore contributes to existing scholarship on the institutional effects of China’s ODI and sheds light on the mechanisms that drive sustainable development.

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Section: Control Variablesmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Does China’s Outward Direct Investment Improve the Institutional Quality of the Belt and Road Countries?

et al. 2020

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“…Entry mode experience is measured by the number of overseas subsidiaries/branches a focal firm has built with specific entry mode [115][116][117]. Secondly, we measure and identify the motivation of internationalization as five dummy variables based on the business scope of each branch/subsidiary, the motivations contain resource-seeking [118,119], technology-seeking [120], market-seeking, strategic [121,122], assets-seeking [10,20,67,123], and the global strategic-seeking [2,9,10,124,125]. We equal the motivations to 1 for the business of foreign subsidiary/branch containing the contents what we set, otherwise 0.…”

Section: Independent Variablesmentioning

confidence: 99%

The Paths of Internationalization of Chinese Innovative Firms

Wang

2020

Sustainability

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Innovative enterprises from emerging markets, such as China, are a group of understudied enterprises, which could generate new and important views on internationalization. Some unique characteristics of Chinese innovative enterprises are creating new ideas that help to a better understanding of entry mode choice, market location choice, and entry speed in the paths of internationalization. Drawing on an unbalanced panel of Chinese innovative enterprises’ outward foreign direct investment (OFDI) event data, we analyzed the tendency of the paths of internationalization of Chinese innovative enterprises and the determining factors that influence the Chinese innovative enterprises’ choice in entry mode, market location, and entry speed. The results show that: (1) Chinese innovative enterprises are more likely to choose developing countries than developed countries. (2) When these firms conduct investment activities in developed countries, the probability rank (from high to low) of entry mode choice is acquisition, along with the wholly-owned subsidiary, exporting and joint venture. When these firms expand the business in developing countries, the entry mode of export is most likely to be chosen and the acquisition is least likely to be chosen. (3) This tendency and paths choice of internationalization in entry mode, market location and entry speed are influenced by the international experience, the multidimensional proximity, psychic distance, internationalization motivation, ownership structure, and innovation ability. Finally, we discuss these contributions and make some suggestions for future research.

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“…[1][2][3][4][5]. For example, investment in developed countries can improve China's technology level, but there are few patents from local independent innovation, and Sustainability 2021, 13, 9824 2 of 19 OFDI can expand exports and alleviate the problem of insufficient resources for domestic economic development, but the degree of impact of OFDI on the home country is closely linked to factors such as technology and resource endowment of the host country [6,7]. Therefore, uncovering important host countries for OFDI can help academics focus on analyzing the impact of these countries' technology and institutional environment on China, and help the Chinese government and enterprises make measures and decisions that are more conducive to investment development.…”

Section: Introductionmentioning

confidence: 99%

Analyzing the Characteristics and Evolution of Chinese Enterprises’ Outward Forward Direct Investment Host Country Network

2021

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With the promulgation of the “Going Global” strategy, Chinese enterprises’ outward forward direct investment (OFDI) moved towards a stage of rapid development. Based on the data concerning projects of Chinese enterprises, this paper establishes a network of OFDI host countries with the industry as the media and analyzes the network and its evolution characteristics by using the complex network method. Results show that the number of network nodes is increasing, and the edges between communities are greater, and the number of countries along the Belt and Road route is increasing. The network is a so-called small-world network. To reduce investment risks, it is necessary to identify the key nodes in the network. Based on the centrality of key nodes in complex networks, the improved “scatter degree” method is used to evaluate the importance of each host node. Results demonstrate that the United States and Australia are the most important countries for Chinese enterprises to invest overseas, followed by Brazil, Canada, Russia, Indonesia, and the United Kingdom (UK). Excluding the UK, all other countries are resource-rich. Thus, it can be seen that the FDI of Chinese enterprises is mainly resource-based investment.

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Location Determinants of China's Outward Foreign Direct Investment

Cited by 24 publications

References 38 publications

Does China’s Outward Direct Investment Improve the Institutional Quality of the Belt and Road Countries?

Does China’s Outward Direct Investment Improve the Institutional Quality of the Belt and Road Countries?

The Paths of Internationalization of Chinese Innovative Firms

Analyzing the Characteristics and Evolution of Chinese Enterprises’ Outward Forward Direct Investment Host Country Network

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