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The determinants of disparities in inward FDI flows to the three macro-regions of China

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  • Ping Zheng

Abstract

This study investigates the determinants of disparities in inward foreign direct investment (FDI) among the three macro-regions of China. A pooled ordinary least squares model (POLS) is employed using a panel dataset at the provincial level. Variations in economic openness (government's preferential policies) and industrial and economic development in terms of market size, human resources, agglomeration and infrastructure are the prime causes of the uneven regional distribution of FDI, which further widens income and economic development inequalities among the three macro-regions. To reduce the degree of regional disparity, the government should offer more extensive preferential policies attracting FDI, especially in energy, transport, resources, high and new technology industries, into the inland regions and increase government investment in education and infrastructure in these areas.

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  • Ping Zheng, 2011. "The determinants of disparities in inward FDI flows to the three macro-regions of China," Post-Communist Economies, Taylor & Francis Journals, vol. 23(2), pages 257-270.
    • Handle: RePEc:taf:pocoec:v:23:y:2011:i:2:p:257-270
    DOI: 10.1080/14631377.2011.570053
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    Cited by:

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    2. Jr-Tsung Huang & Ming-Lei Chang, 2018. "Fiscal Transparency And Foreign Direct Investment In China," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 63(04), pages 839-859, September.
    3. Zheng, Lucy & Batuo, Michael Enowbi & Shepherd, David, 2017. "The Impact of Regional and Institutional Factors on Labor Productive Performance—Evidence from the Township and Village Enterprise Sector in China," World Development, Elsevier, vol. 96(C), pages 591-598.
    4. Shang, Qingyan & Poon, Jessie P.H. & Yue, Qingtang, 2012. "The role of regional knowledge spillovers on China's innovation," China Economic Review, Elsevier, vol. 23(4), pages 1164-1175.
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