Sectoral location of FDI in China

Lin, Mi and Kwan, Yum K. (2011) Sectoral location of FDI in China. The World Economy, 34 (7). pp. 1181-1198. ISSN 0378-5920

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This study investigates the determinants of foreign direct investment (FDI) sectoral allocation in 29 manufacturing sectors in China from 2000 to 2007. We find that FDI sectoral allocation has a strong self-reinforcing effect. Multinational corporations with ownership advantages tend to invest more in local high-productivity sectors. The FDI presence, however, is discouraged in China’s high-productivity sectors in which the major market share is dominated by state-owned enterprises. We also find that the degree of FDI penetration is higher in sectors that are producing labour-intensive goods and also export oriented.

Keywords:Foreign direct investment
Subjects:N Business and Administrative studies > N321 Investment
Divisions:Lincoln International Business School
ID Code:9768
Deposited On:07 Jun 2013 10:33

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