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Foreign direct investment and innovation in China's e-commerce sector

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  • Wang, Xin

Abstract

By comparing the business practices and performance of foreign-invested and local Internet companies in China, this article outlines the important factors that multinational corporations must address to gain competitive advantages in China's e-commerce sector. Specifically, this research compares EachNet (eBay) with Taobao in the consumer-to-consumer market; eLong (Expedia) with Ctrip and Joyo (Amazon) with Dangdang in the business-to-consumer market; and the online search engines Google China and Baidu. The author underscores the importance of local knowledge for firm performance and success. Foreign firms must improve their understanding of and ability to adapt to local cultural, social, economic, and political environments.

Suggested Citation

  • Wang, Xin, 2012. "Foreign direct investment and innovation in China's e-commerce sector," Journal of Asian Economics, Elsevier, vol. 23(3), pages 288-301.
    • Handle: RePEc:eee:asieco:v:23:y:2012:i:3:p:288-301
    DOI: 10.1016/j.asieco.2010.11.007
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    References listed on IDEAS

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    1. Wolfgang Keller, 2002. "Geographic Localization of International Technology Diffusion," American Economic Review, American Economic Association, vol. 92(1), pages 120-142, March.
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    4. Fred D. Davis & Richard P. Bagozzi & Paul R. Warshaw, 1989. "User Acceptance of Computer Technology: A Comparison of Two Theoretical Models," Management Science, INFORMS, vol. 35(8), pages 982-1003, August.
    5. Kingsley E. Haynes & Lei Ding, 2006. "Technology, Innovation and Latecomer Strategies: Evidence from the Mobile Handset Manufacturing Sector in China," ERSA conference papers ersa06p17, European Regional Science Association.
    6. Choi, Changkyu, 2003. "Does the Internet stimulate inward foreign direct investment?," Journal of Policy Modeling, Elsevier, vol. 25(4), pages 319-326, June.
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    8. Ko, Kwan Wai, 2007. "Internet externalities and location of foreign direct investment: A comparison between developed and developing countries," Information Economics and Policy, Elsevier, vol. 19(1), pages 1-23, March.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Yu Chen & Yuandi Wang & Shan Chen, 2021. "Are Chinese Executives Rewarded or Penalized by the Operation of High-Speed Railways?," Sustainability, MDPI, vol. 13(21), pages 1-14, October.

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    More about this item

    Keywords

    E-commerce; Foreign direct investment; Technology innovation;
    All these keywords.

    JEL classification:

    • L81 - Industrial Organization - - Industry Studies: Services - - - Retail and Wholesale Trade; e-Commerce
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives

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