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The impact of foreign direct investment on the productivity of China’s automotive industry

Author

Listed:
  • Peter J. Buckley

    (Leeds University Business School
    Leeds University Business School
    Leeds University)

  • Jeremy Clegg

    (University of Leeds)

  • Ping Zheng

    (University of Leeds)

  • Pamela A. Siler

    (University of Abertay Dundee)

  • Gianluigi Giorgioni

    (Liverpool John Moores University)

Abstract

Abstract and Key Results This study contributes to the existing literature by empirically investigating the effect of FDI inflows on the aggregate labour productivity of China’s automotive industry. A production function model is developed using a panel data set at sub-sector level. Two statistical models: pooled ordinary least squares model (POLS) and fixed effects model (FES) were used to estimate the influence of foreign direct investment on aggregate labour productivity in the industry. Inward FDI plays a positive role in increasing industrial productivity, implying that the government should continue to encourage inward investment. However the results also suggest that efforts to increase capital intensity and average firm size in the industry will also improve labour productivity.

Suggested Citation

  • Peter J. Buckley & Jeremy Clegg & Ping Zheng & Pamela A. Siler & Gianluigi Giorgioni, 2007. "The impact of foreign direct investment on the productivity of China’s automotive industry," Management International Review, Springer, vol. 47(5), pages 707-724, September.
    • Handle: RePEc:spr:manint:v:47:y:2007:i:5:d:10.1007_s11575-007-0041-1
    DOI: 10.1007/s11575-007-0041-1
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    References listed on IDEAS

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    Cited by:

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    2. Neng Liang & Shu Lin, 2008. "Erroneous Learning from the West? A Narrative Analysis of Chinese MBA Cases Published in 1992, 1999 and 2003," Management International Review, Springer, vol. 48(5), pages 603-638, November.
    3. Taotao Chen & Ari Kokko & Patrik Gustavsson Tingvall, 2011. "FDI and spillovers in China: non-linearity and absorptive capacity," Journal of Chinese Economic and Business Studies, Taylor & Francis Journals, vol. 9(1), pages 1-22.
    4. Stucchi, Rodolfo & Rojo, Sofía & Maffioli, Alessandro & Castillo, Victoria, 2014. "Knowledge Spillovers of Innovation Policy through Labor Mobility: An Impact Evaluation of the FONTAR Program in Argentina," IDB Publications (Working Papers) 4779, Inter-American Development Bank.
    5. Jiang, Crystal X. & Yang, Qin & Li, Sali & Wang, Yong, 2011. "The moderating effect of foreign direct investment intensity on local firms' intangible resources investment and performance implications: A case from China," Journal of International Management, Elsevier, vol. 17(4), pages 291-302.
    6. Peter J. Buckley & Adam R. Cross & Hui Tan & Liu Xin & Hinrich Voss, 2008. "Historic and Emergent Trends in Chinese Outward Direct Investment," Management International Review, Springer, vol. 48(6), pages 715-748, December.
    7. Abdul Hannan & Faheem Haider & Nisar Ahmad & Tahira Ishaq, 2015. "Impact of Economic, Social and Environmental Variables on Competitiveness of Automotive Industry: Evidence from Panel Data," Bulletin of Energy Economics (BEE), The Economics and Social Development Organization (TESDO), vol. 3(4), pages 194-202, December.

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