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Growing against the background of colonization? Chinese labor market and FDI in a historical perspective

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  • Wang, Hao
  • Fidrmuc, Jan
  • Tian, Yunhua

Abstract

This article investigates how the legacy of colonization shapes the impact of inward FDI on employment in the Chinese labor market. The analysis utilizes provincial panel on overall employment and employment in the service sector from 2006 to 2015. We find that inward FDI significantly promotes employment and that this relationship is stronger in regions once colonized by Western countries. Conversely, regions with a legacy of Japanese colonization display a weaker, and even negative, relationship between FDI and employment. These findings are robust to controlling for the length and intensity of colonization, as well as for endogeneity of FDI.

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  • Wang, Hao & Fidrmuc, Jan & Tian, Yunhua, 2020. "Growing against the background of colonization? Chinese labor market and FDI in a historical perspective," International Review of Economics & Finance, Elsevier, vol. 69(C), pages 1018-1031.
  • Handle: RePEc:eee:reveco:v:69:y:2020:i:c:p:1018-1031
    DOI: 10.1016/j.iref.2018.12.010
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    Cited by:

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    5. Ludovic Feulefack Kemmanang & Jonas Juleo Dongmo Zamke, 2021. "Colonial spectre and foreign investments concentration: Does African growth escape?," Economics Bulletin, AccessEcon, vol. 41(1), pages 137-154.
    6. Shouxin Bai & Shicheng Zhou & Yuyao Sheng & Xingwei Wang, 2022. "Does Lockdown Reduce Employment in Major Developing Countries? An Assessment Based on Multiregional Input–Output Model and Scenario Analysis," Sustainability, MDPI, vol. 14(12), pages 1-19, June.
    7. Feng, Ya & Wen, Junqi, 2023. "Foreign direct investment and employee income share: Firm-level evidence," Finance Research Letters, Elsevier, vol. 55(PA).
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    More about this item

    Keywords

    Foreign direct investment; Colonization; Human capital; China;
    All these keywords.

    JEL classification:

    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • F54 - International Economics - - International Relations, National Security, and International Political Economy - - - Colonialism; Imperialism; Postcolonialism
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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