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The Determinants of Chinese Outward Foreign Direct Investment

In: Foreign Direct Investment, China and the World Economy

Author

Listed:
  • Peter J. Buckley

    (University of Leeds (CIBUL))

  • L. Jeremy Clegg

    (Leeds University Business School)

  • Adam Cross

    (Leeds University Business School)

  • Xin Liu

    (BNP Paribus Hong Kong)

  • Hinrich Voss

    (Leeds University Business School)

  • Ping Zheng

    (University of Westminster)

Abstract

This paper investigates the determinants of foreign direct investment (FDI) by Chinese multinational enterprises (MNEs) over the period 1984 to 2001.1 The process of China’s deepening re-integration with the global economy began, in the modern era, with the ‘Open Door’ policies of the late 1970s, and accelerated with accession to the World Trade Organisation (WTO) in 2001. Studies of this process generally examine China in terms of its position in global trade flows (e.g., Lall and Albaladejo, 2004); its comparative advantage as a manufacturing location (e.g., Chen et ah, 2002; Rowen, 2003); and in the volume, distribution and impacts of inbound FDI (e.g., Buckley et ah, 2002; Buckley, 2004b).2 In contrast, understanding of a further dimension to this process — namely, the rise in Chinese outward direct investment (ODI) — remains very incomplete. One reason is the paucity of sufficiently disaggregated data to permit formal analysis of the forces shaping Chinese ODI. The result has been a preponderance of descriptive research on FDI trends (e.g., Taylor, 2002; Deng, 2003, 2004; Wong and Chan, 2003; Buckley et ah, 2006) coupled with in-depth case studies on a small number of high-profile Chinese MNEs (e.g., Liu and Li, 2002; Warner et ah, 2004).

Suggested Citation

  • Peter J. Buckley & L. Jeremy Clegg & Adam Cross & Xin Liu & Hinrich Voss & Ping Zheng, 2010. "The Determinants of Chinese Outward Foreign Direct Investment," Palgrave Macmillan Books, in: Foreign Direct Investment, China and the World Economy, chapter 6, pages 81-118, Palgrave Macmillan.
    • Handle: RePEc:pal:palchp:978-0-230-24832-8_6
    DOI: 10.1057/9780230248328_6
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    Citations

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    Cited by:

    1. Qi Gao & Qiang Wang & Wei Zhang, 2024. "How business environment of countries along the Belt and Road impacts China’s OFDI efficiency: a stochastic frontier gravity model approach," Palgrave Communications, Palgrave Macmillan, vol. 11(1), pages 1-11, December.
    2. Fuzhong Chen & Guohai Jiang, 2021. "Investigating the Impact of Institutional Quality on FDI: Are There Promotional Effects in Economic Integration Regions?," Sustainability, MDPI, vol. 13(20), pages 1-16, October.
    3. Olawoyin Gregory Adedigba & Runhui Lin & Nizam Ud Din, 2020. "The degree of internationalization of Chinese Multinationals along the belt and road initiative countries," PLOS ONE, Public Library of Science, vol. 15(7), pages 1-22, July.
    4. Assad Ullah & Xinshun Zhao & Muhammad Abdul Kamal & Jiajia Zheng, 2022. "Environmental regulations and inward FDI in China: Fresh evidence from the asymmetric autoregressive distributed lag approach," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 27(1), pages 1340-1356, January.
    5. Barnard, Helena, 2021. "Host countries' level of development and internationalization from emerging markets: A typology of firm strategies," Journal of International Management, Elsevier, vol. 27(3).
    6. Tatsiana Dziavochka & Elyas Abdulahi Mohamued, 2020. "The Nexus of Chinese OFDI Innovation and Entrepreneurship in Europe: A True Fixed Effect Stochastic Analysis," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 10(4), pages 399-414, April.
    7. Torres de Oliveira, Rui & Nguyen, Tam & Liesch, Peter & Verreynne, Martie-Louise & Indulska, Marta, 2021. "Exporting to escape and learn: Vietnamese manufacturers in global value chains," Journal of World Business, Elsevier, vol. 56(4).
    8. Kong, Qunxi & Guo, Rui & Wang, Yang & Sui, Xiuping & Zhou, Shimin, 2020. "Home-country environment and firms’ outward foreign direct investment decision: Evidence from Chinese firms," Economic Modelling, Elsevier, vol. 85(C), pages 390-399.
    9. Sucharita Gopal & Joshua Pitts & Zhongshu Li & Kevin P. Gallagher & James G. Baldwin & William N. Kring, 2018. "Fueling Global Energy Finance: The Emergence of China in Global Energy Investment," Energies, MDPI, vol. 11(10), pages 1-25, October.
    10. Yan, Hongmin & Hu, Xiaowen & Liu, Yulong, 2020. "The international market selection of Chinese SMEs: How institutional influence overrides psychic distance," International Business Review, Elsevier, vol. 29(4).
    11. Yanfeng Liu & Xue Li & Xiaonan Zhu & Min-Kyu Lee & Po-Lin Lai, 2023. "The theoretical systems of OFDI location determinants in global north and global south economies," Palgrave Communications, Palgrave Macmillan, vol. 10(1), pages 1-13, December.
    12. Lu, Xinhai & Li, Yan & Ke, Shangan, 2020. "Spatial distribution pattern and its optimization strategy of China’s overseas farmland investments," Land Use Policy, Elsevier, vol. 91(C).

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