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Location Choice of Multinational Enterprises in China: Comparison between Japan and Taiwan

Author

Listed:
  • Kuo-I CHANG

    (Department of Applied Economics, National Chung Hsing University, Taiwan)

  • Kazunobu HAYAKAWA

    (Inter-disciplinary Studies Center, Institute of Developing Economies, Japan)

  • Toshiyuki MATSUURA

    (Institute of Economic and Industrial Studies, Keio University,Japan)

Abstract

This paper explores the location choice of MNEs in China, shedding special light on the role of agglomeration of same-nationality firms. In particular, we examine how its role differs according to investors’ productivity. Furthermore, we compare the location choice of Japanese and Taiwanese MNEs in China, because Taiwanese MNEs are expected to experience less uncertainty in investing in China than Japanese MNEs, due to Taiwan’s linguistic and cultural advantages in China. We find that, less productive Japanese firms prefer to locate close to larger same-nationality agglomerations, there are no differences in location according to firms’ productivity in the case of Taiwanese firms.

Suggested Citation

  • Kuo-I CHANG & Kazunobu HAYAKAWA & Toshiyuki MATSUURA, 2011. "Location Choice of Multinational Enterprises in China: Comparison between Japan and Taiwan," Working Papers DP-2011-01, Economic Research Institute for ASEAN and East Asia (ERIA).
    • Handle: RePEc:era:wpaper:dp-2011-01
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    References listed on IDEAS

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    Cited by:

    1. Francisco Puig & Borja Portero & Miguel González-Loureiro, 2017. "Clustering strategy and development of subsidiaries in China," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 44(2), pages 221-243, June.
    2. Yoshifumi Fukunaga & Arata Kuno, 2012. "Toward a Consolidated Preferential Tariff Structure in East Asia: Going beyond ASEAN+1 FTAs," Working Papers PB-2012-03, Economic Research Institute for ASEAN and East Asia (ERIA).
    3. Kemboi Michael Kipkorir & Martine Oleche, 2020. "Short and Long-Run Impact of Trade Liberalization on Agricultural Growth in Kenya," International Journal of Finance, Insurance and Risk Management, International Journal of Finance, Insurance and Risk Management, vol. 10(3), pages 117-131.
    4. Yamashita, Nobuaki & Matsuura, Toshiyuki & Nakajima, Kentaro, 2014. "Agglomeration effects of inter-firm backward and forward linkages: Evidence from Japanese manufacturing investment in China," Journal of the Japanese and International Economies, Elsevier, vol. 34(C), pages 24-41.
    5. YAMASHITA Nobuaki & YAMAUCHI Isamu, 2019. "Effects of Offshore Production and R&D on Domestic Innovation Activities," Discussion papers 19068, Research Institute of Economy, Trade and Industry (RIETI).
    6. Yamashita, Nobuaki & Yamauchi, Isamu, 2019. "The effects of offshore production on onshore innovation: Evidence from Japanese multinationals," Research Policy, Elsevier, vol. 48(9), pages 1-1.

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    More about this item

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • M10 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - General

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