Institutions and Foreign Direct Investment: China versus the Rest of the World
Abstract
Summary Weak institutions impede foreign direction investment (FDI), yet China attracts massive FDI despite global media spotlighting its institutional infirmities. Standard institutional quality variables poorly track rapid transformations, like China' regime shift following Den Xiaoping's 1993 Southern Tour. Economy track record usefully augments these variables in such cases. Cross-country regressions controlling for institutional quality and economy track record reveal China's FDI inflow unexceptional. Rather, China's FDI inundation resembles analogous post-reform East Bloc events. Arguments that China's FDI inflow is inefficiently large because weak institutions deter domestic investment while special initiatives attract FDI are thus either unsupported or not unique to China.Download Info
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Bibliographic Info
Article provided by Elsevier in its journal World Development.
Volume (Year): 37 (2009)
Issue (Month): 4 (April)
Pages: 852-865
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Web page: http://www.elsevier.com/locate/worlddev
Related research
Keywords: institution FDI cross-country China;References
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Citations
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.Cited by:
- Berna Kirkulak & Bin Qiu & Wei Yin, 2011. "The impact of FDI on air quality: evidence from China," Journal of Chinese Economic and Foreign Trade Studies, Emerald Group Publishing, vol. 4(2), pages 81-98, June.
- Anyanwu John, 2011. "Working Paper 136 - Determinants of Foreign Direct Investment Inflows to Africa, 1980-2007," Working Paper Series 327, African Development Bank.
- John C. Anyanwu, 2012. "Why Does Foreign Direct Investment Go Where It Goes?: New Evidence From African Countries," Annals of Economics and Finance, Society for AEF, vol. 13(2), pages 425-462, November.
- Yao, Yang & Yueh, Linda, 2009. "Law, Finance, and Economic Growth in China: An Introduction," World Development, Elsevier, vol. 37(4), pages 753-762, April.
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