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Spillovers from Taiwan, Hong Kong, and Macau Investment and from Other Foreign Investment in Chinese Industries

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  • Jr‐Tsung Huang

Abstract

In its analysis of the impact of foreign investment on China's productivity, this article develops two empirical models: one using labor productivity and the other using total factor productivity (TFP). Using cross‐provincial data on Chinese industries for 1993, 1994, and 1997 to regress the empirical models, it is concluded that the impact of investment differed depending on its source, with that from these overseas Chinese enterprises contributing to the spillover effect in regions with a high technology gap, whereas that from other foreign enterprises tending to improve productivity and TFP primarily in regions with a low technology gap. (JEL D24, F13, F15, L60)

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  • Jr‐Tsung Huang, 2004. "Spillovers from Taiwan, Hong Kong, and Macau Investment and from Other Foreign Investment in Chinese Industries," Contemporary Economic Policy, Western Economic Association International, vol. 22(1), pages 13-25, January.
    • Handle: RePEc:bla:coecpo:v:22:y:2004:i:1:p:13-25
    DOI: 10.1093/cep/byh002
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    Cited by:

    1. Yuyuan Wen, 2014. "The spillover effect of FDI and its impact on productivity in high economic output regions: A comparative analysis of the Yangtze River Delta and the Pearl River Delta, China," Papers in Regional Science, Wiley Blackwell, vol. 93(2), pages 341-365, June.
    2. Chen, George S. & Yao, Yao & Malizard, Julien, 2017. "Does foreign direct investment crowd in or crowd out private domestic investment in China? The effect of entry mode," Economic Modelling, Elsevier, vol. 61(C), pages 409-419.
    3. Buckley, Peter J. & Wang, Chengqi & Clegg, Jeremy, 2007. "The impact of foreign ownership, local ownership and industry characteristics on spillover benefits from foreign direct investment in China," International Business Review, Elsevier, vol. 16(2), pages 142-158, April.
    4. Natasha Agarwal & Chris Milner, 2011. "FDI Spillovers in China – Connecting the Missing Link between Micro and Macro," Discussion Papers 11/20, University of Nottingham, GEP.
    5. L. Pérez-Villar & A. Seric, 2015. "Multinationals in Sub-Saharan Africa: Domestic linkages and institutional distance," International Economics, CEPII research center, issue 142, pages 94-117.
    6. Lin, Faqin, 2015. "Learning by exporting effect in China revisited: An instrumental Approach," China Economic Review, Elsevier, vol. 36(C), pages 1-13.
    7. Faqin Lin, 2018. "Cross†country diffusion of ideology via FDI : Micro†evidence from China," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 26(1), pages 3-34, January.
    8. Kun Jiang & Wolfgang Keller & Larry D. Qiu & William Ridley, 2018. "International Joint Ventures and Internal Technology Transfer vs. External Technology Spillovers: Evidence from China," NBER Working Papers 24455, National Bureau of Economic Research, Inc.
    9. Faqin Lin, 2011. "Labor Quality and Inward FDI: A Firm‐level Empirical Study in China," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 19(3), pages 68-86, May.
    10. Theresa M. Greaney & Yao Li, 2013. "Trade, Foreign Direct Investment and Wage Inequality in China: A Heterogeneous Firms Approach," China Economic Policy Review (CEPR), World Scientific Publishing Co. Pte. Ltd., vol. 2(02), pages 1-49.
    11. Theresa M. Greaney & Yao Li, 2017. "Examining Determinants of Foreign Wage Premiums in China," The World Economy, Wiley Blackwell, vol. 40(10), pages 2056-2077, October.
    12. Travis G. Coan & Tadeusz Kugler, 2012. "All Foreign Direct Investment Is Local: Indian Provincial Politics and the Attraction of FDI," South Asia Economic Journal, Institute of Policy Studies of Sri Lanka, vol. 13(1), pages 27-50, March.
    13. Ying Zhou & Sukanlaya Sawang & Xiaohua Yang, 2016. "Understanding The Regional Innovation Capacity In China After Economic Reforms," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 20(06), pages 1-36, August.
    14. Ito, Banri & Yashiro, Naomitsu & Xu, Zhaoyuan & Chen, XiaoHong & Wakasugi, Ryuhei, 2012. "How do Chinese industries benefit from FDI spillovers?," China Economic Review, Elsevier, vol. 23(2), pages 342-356.
    15. Kun Jiang & Wolfgang Keller & Larry D. Qiu & William Ridley, 2018. "International Joint Ventures and Internal vs. External Technology Transfer: Evidence from China," CESifo Working Paper Series 7065, CESifo.
    16. Faqin Lin & Chao Zhang & Lin Wang, 2013. "Vertical Spillover Effects of Multinationals on Chinese Domestic Firms via Supplier–Customer Relationships," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 21(6), pages 37-57, November.
    17. Rossitza B. Wooster & David S. Diebel, 2010. "Productivity Spillovers from Foreign Direct Investment in Developing Countries: A Meta-Regression Analysis," Review of Development Economics, Wiley Blackwell, vol. 14(s1), pages 640-655, August.
    18. Keller, Wolfgang & Ridley, William & Qiu, Larry D. & Jiang, Kun, 2018. "International Joint Ventures and Internal versus External Technology Transfer: Evidence from China," CEPR Discussion Papers 12809, C.E.P.R. Discussion Papers.
    19. Y Wei & X Liu, 2006. "Productivity spillovers from R&D, exports and FDI in China's manufacturing sector," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 37(4), pages 544-557, July.

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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
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F15 - International Economics - - Trade - - - Economic Integration
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General

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