IDEAS home Printed from https://ideas.repec.org/a/eee/asieco/v92y2024ics104900782400040x.html
   My bibliography  Save this article

Artificial intelligence and outward foreign direct investment: Evidence from China

Author

Listed:
  • Huang, Keqi
  • Liu, Qiren

Abstract

We investigate the impacts of robot adoption (a representative form of artificial intelligence) on outward foreign direct investment (OFDI) by firms in China. First, we construct a unique firm-level dataset of A-share listed firms and conduct empirical analysis by adopting a staggered difference-in-differences (DID) strategy. Second, we find that changes in robot adoption on both the extensive and intensive margins encourage firms to conduct more OFDIs. Specifically, robot adoption has positive effects on multidimensional categories of OFDI but has no significant impact on buying OFDI. Third, we explore the underlying mechanism to show that the rise in output and growth of total factor productivity (TFP) matter. Fourth, we conduct a series of empirical tests to check robustness and obtain consistent results. Finally, we analyze the heterogeneous effects and find that adoption firms with state-owned ownership or higher profit tend to send more OFDI projects, especially to the Organization for Economic Co-operation and Development (OECD)-rich countries. Our findings elucidate the impact of robot adoption on OFDI at the firm level in developing and transition countries.

Suggested Citation

  • Huang, Keqi & Liu, Qiren, 2024. "Artificial intelligence and outward foreign direct investment: Evidence from China," Journal of Asian Economics, Elsevier, vol. 92(C).
    • Handle: RePEc:eee:asieco:v:92:y:2024:i:c:s104900782400040x
    DOI: 10.1016/j.asieco.2024.101745
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S104900782400040X
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.asieco.2024.101745?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Keywords

    Artificial intelligence; Industrial robots; Difference-in-differences; Outward foreign direct investment; OECD;
    All these keywords.

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion and Avoidance
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:asieco:v:92:y:2024:i:c:s104900782400040x. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/asieco .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.