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The determinants of China's outward foreign direct investment

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  • Zhang, Xiaoxi
  • Daly, Kevin

Abstract

Globalisation has led to a rapid increase in the growth of foreign direct investment (FDI) globally. Over the last decade China has become the largest recipient of FDI whilst simultaneously increasing its outward FDI dramatically. The growth in China's outward FDI has attracted little attention from scholars in mainstream research publications. The motivation behind this paper is to investigate the factors driving this growth from both economic and strategic backgrounds. The paper employs panel data analysis covering the period 2003–2009 where we quantify the main drivers of China's outward FDI across a range of variables including bi lateral and multi lateral trade, market size, GDP growth, openness and resource endowment.

Suggested Citation

  • Zhang, Xiaoxi & Daly, Kevin, 2011. "The determinants of China's outward foreign direct investment," Emerging Markets Review, Elsevier, vol. 12(4), pages 389-398.
  • Handle: RePEc:eee:ememar:v:12:y:2011:i:4:p:389-398
    DOI: 10.1016/j.ememar.2011.06.001
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    References listed on IDEAS

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    Cited by:

    1. Vito Amendolagine & Claudio Cozza & Roberta Rabellotti, 2015. "Chinese and Indian Multinationals: A Firm-Level Analysis of their Investments in Europe," Global Economic Review, Taylor & Francis Journals, vol. 44(4), pages 452-469, December.
    2. Pareja-Alcaraz, Pablo, 2017. "Chinese investments in Southern Europe's energy sectors: Similarities and divergences in China's strategies in Greece, Italy, Portugal and Spain," Energy Policy, Elsevier, vol. 101(C), pages 700-710.
    3. Groh, Alexander Peter & Wich, Matthias, 2012. "Emerging economies' attraction of foreign direct investment," Emerging Markets Review, Elsevier, vol. 13(2), pages 210-229.
    4. Wei, Yingqi & Zheng, Nan & Liu, Xiaohui & Lu, Jiangyong, 2014. "Expanding to outward foreign direct investment or not? A multi-dimensional analysis of entry mode transformation of Chinese private exporting firms," International Business Review, Elsevier, vol. 23(2), pages 356-370.
    5. Stoian, Carmen, 2013. "Extending Dunning's Investment Development Path: The role of home country institutional determinants in explaining outward foreign direct investment," International Business Review, Elsevier, vol. 22(3), pages 615-637.
    6. Mina, Wasseem & Jaeck, Louis, 2015. "Labor Market Flexibility and FDI Flows: Evidence from Oil-Rich GCC and Middle Income Countries," MPRA Paper 62652, University Library of Munich, Germany.
    7. Alvandi , Keyvan & Chaminade , Cristina & Lv, Ping, 2013. "Commonalities and differences between production-related FDI (PFDI) and technology-related FDI (TFDI) in developed and emerging economies," Papers in Innovation Studies 2013/47, Lund University, CIRCLE - Center for Innovation, Research and Competences in the Learning Economy.
    8. Chun Ju Lin, 2015. "How Information from Taiwan-based Enterprises in China Influences Investment Decisions of China-based Service Enterprises in Taiwan," Journal of Enterprising Culture (JEC), World Scientific Publishing Co. Pte. Ltd., vol. 23(02), pages 167-197, June.
    9. Reddy, K.S. & Xie, En & Huang, Yuanyuan, 2016. "Cross-border acquisitions by state-owned and private enterprises: A perspective from emerging economies," Journal of Policy Modeling, Elsevier, vol. 38(6), pages 1147-1170.
    10. Anwar, Amar & Mughal, Mazhar, 2014. "Why do Russian firms invest abroad? A firm level analysis," MPRA Paper 58178, University Library of Munich, Germany.
    11. Xie, En & Reddy, K.S. & Liang, Jie, 2017. "Country-specific determinants of cross-border mergers and acquisitions: A comprehensive review and future research directions," Journal of World Business, Elsevier, vol. 52(2), pages 127-183.
    12. repec:eee:touman:v:59:y:2017:i:c:p:1-6 is not listed on IDEAS
    13. Yao, Shujie & Wang, Pan & Zhang, Jing & Ou, Jinghua, 2016. "Dynamic relationship between China's inward and outward foreign direct investments," China Economic Review, Elsevier, vol. 40(C), pages 54-70.
    14. Chensheng Xu & Feng Yao & Fan Zhang, 2015. "An Investigation of Confucius Institute’s Effects on China’s OFDI via Cultural Difference and Institutional Quality," Working Papers 15-45, Department of Economics, West Virginia University.
    15. Boys, Kathryn & Kandilov, Ivan, 2016. "Strategic Acquisitions: Determinants Of Chinese Outward Direct Investment In The Agrifood Industry," 2016 Annual Meeting, July 31-August 2, 2016, Boston, Massachusetts 235972, Agricultural and Applied Economics Association.
    16. repec:eee:advacc:v:31:y:2015:i:2:p:228-238 is not listed on IDEAS

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    Keywords

    China; Outward foreign direct investment;

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