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FDI, Export Sophistications, and Export Upgrading in Emerging Economies: Evidence from Chinese Manufacturings

Author

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  • ZHANG, Kevin H.

    (Department of Economics, Illinois State University, Normal, Illinois, USA)

Abstract

Export upgrading, reflecting improved export sophistication or technological capabilities over time, can bring a nation larger benefits from international trade. How does foreign direct investment (FDI) affect export sophistication and export upgrading in emerging economies? While the topic is important and timing, studies on the issue in the literature have been limited. This paper attempts to close the gap by using the Chinese manufacturing panel data in 2005-2013. Estimates suggest that FDI indeed has strong sophistication- and upgrading-enhancing effects on China’s manufactured exports; and such gains from FDI depend largely on China’s absorptive capacity measured by human capital. FDI, sofisticazioni e promozione dell’export nelle economie emergenti: evidenze dal caso dei manufatti cinesi La promozione dell’export, considerato il potenziamento nel tempo delle sofisticazioni o delle capacità tecnologiche, può portare benefici maggiori ad un paese tramite il commercio internazionale. In quale modo le sofisticazioni e la promozione delle esportazioni di un’economia emergente sono influenzate dagli investimenti diretti esteri? Nonostante l’importanza e l’attualità dell’argomento, vi sono pochi studi al riguardo. Questo lavoro è un tentativo di colmare questa mancanza utilizzando dati panel relativi ai manufatti cinesi nel periodo 2005-2013. Le stime evidenziano che gli investimenti diretti esteri hanno notevoli effetti sulle sofisticazioni e sulla promozione delle esportazioni di manufatti cinesi. Questo vantaggio ricevuto dagli IDE dipende largamente dalla capacità di assorbimento della Cina misurata attraverso la variabile capitale umano.

Suggested Citation

  • ZHANG, Kevin H., 2017. "FDI, Export Sophistications, and Export Upgrading in Emerging Economies: Evidence from Chinese Manufacturings," Economia Internazionale / International Economics, Camera di Commercio Industria Artigianato Agricoltura di Genova, vol. 70(2), pages 245-260.
    • Handle: RePEc:ris:ecoint:0802
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    References listed on IDEAS

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    More about this item

    Keywords

    Foreign Direct Investment (FDI); Export Sophistications (XS); Export Upgrading (XU); Manufactured Exports (MX);
    All these keywords.

    JEL classification:

    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East

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