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The determinants of disparities in inward FDI flows to the three macro-regions of China

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  • Ping Zheng

Abstract

This study investigates the determinants of disparities in inward foreign direct investment (FDI) among the three macro-regions of China. A pooled ordinary least squares model (POLS) is employed using a panel dataset at the provincial level. Variations in economic openness (government's preferential policies) and industrial and economic development in terms of market size, human resources, agglomeration and infrastructure are the prime causes of the uneven regional distribution of FDI, which further widens income and economic development inequalities among the three macro-regions. To reduce the degree of regional disparity, the government should offer more extensive preferential policies attracting FDI, especially in energy, transport, resources, high and new technology industries, into the inland regions and increase government investment in education and infrastructure in these areas.

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  • Ping Zheng, 2011. "The determinants of disparities in inward FDI flows to the three macro-regions of China," Post-Communist Economies, Taylor & Francis Journals, vol. 23(2), pages 257-270.
    • Handle: RePEc:taf:pocoec:v:23:y:2011:i:2:p:257-270
    DOI: 10.1080/14631377.2011.570053
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    Cited by:

    1. Katiuscia Vaccarini, 2014. "Psychic distance and FDI: the case of China," Working Papers 1403, c.MET-05 - Centro Interuniversitario di Economia Applicata alle Politiche per L'industria, lo Sviluppo locale e l'Internazionalizzazione.
    2. Jr-Tsung Huang & Ming-Lei Chang, 2018. "Fiscal Transparency And Foreign Direct Investment In China," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 63(04), pages 839-859, September.
    3. Shang, Qingyan & Poon, Jessie P.H. & Yue, Qingtang, 2012. "The role of regional knowledge spillovers on China's innovation," China Economic Review, Elsevier, vol. 23(4), pages 1164-1175.
    4. Yapatake Kossele Thales Pacific & Ngaba Mbai-Akem Gabriella Magalie, 2023. "One Bad Turn Deserves Another: How Energy Production, Financial Instability, and Political Governance Crisis Sustain the Decline of FDI Inflows in the Central African Republic," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 14(2), pages 831-853, June.
    5. Zheng, Lucy & Batuo, Michael Enowbi & Shepherd, David, 2017. "The Impact of Regional and Institutional Factors on Labor Productive Performance—Evidence from the Township and Village Enterprise Sector in China," World Development, Elsevier, vol. 96(C), pages 591-598.

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