IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this paper or follow this series

Does Chinese Investment Contribute to The US Economy? An Analysis of Selected US States’ Growth, Employment and Exports

  • Hasanat Shah, Syed
  • Li, Jun Jiang
Registered author(s):

    Our paper analyzed the impact and causal relation of outbound Chinese FDI on growth, employment and export performance of 16 selected US states. The study employed Panel data where contemporaneous panel fixed estimation results shows that the impact of Chinese outbound FDI on employment and export are insignificant. However, the impact of FDI on growth is positive and significant in interaction with States export to China. Applying heterogeneous panel causality approach on a refined dynamic panel model indicates that Chinese FDI does not cause GDP, exports and employment while the results of reverse causality shows that US States GDP (market size) cause the inflow of Chinese outbound FDI. Though the impact of meager Chinese out bound FDI in the US is insignificant to marginally positive but in no way the impact is adverse. Keeping in view the experience of Japanese outbound FDI to the US in 1980's, we come up with some policy recommendation for Chinese investors.

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

    File URL: http://mpra.ub.uni-muenchen.de/52575/1/MPRA_paper_52575.pdf
    File Function: original version
    Download Restriction: no

    Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 52575.

    as
    in new window

    Length:
    Date of creation: 2013
    Date of revision:
    Handle: RePEc:pra:mprapa:52575
    Contact details of provider: Postal: Schackstr. 4, D-80539 Munich, Germany
    Phone: +49-(0)89-2180-2219
    Fax: +49-(0)89-2180-3900
    Web page: http://mpra.ub.uni-muenchen.de

    More information through EDIRC

    References listed on IDEAS
    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

    as in new window
    1. Eduardo Borensztein & Jose De Gregorio & Jong-Wha Lee, 1995. "How Does Foreign Direct Investment Affect Economic Growth?," NBER Working Papers 5057, National Bureau of Economic Research, Inc.
    2. Barry, Frank & Bradley, John, 1997. "FDI and Trade: The Irish Host-Country Experience," Economic Journal, Royal Economic Society, vol. 107(445), pages 1798-1811, November.
    3. Mortimore, Michael, 2000. "Corporate Strategies for FDI in the Context of Latin America's New Economic Model," World Development, Elsevier, vol. 28(9), pages 1611-1626, September.
    4. Eckhardt Bode & Peter Nunnenkamp & Andreas Waldkirch, 2012. "Spatial effects of foreign direct investment in US states," Canadian Journal of Economics, Canadian Economics Association, vol. 45(1), pages 16-40, February.
    5. Keith Head & John Ries & Deborah Swenson, 1994. "Agglomeration Benefits and Location Choice: Evidence from Japanese Manufacturing Investment in the United States," NBER Working Papers 4767, National Bureau of Economic Research, Inc.
    6. Gabor Hunya, 2002. "Restructuring Through FDI in Romanian Manufacturing," wiiw Research Reports 287, The Vienna Institute for International Economic Studies, wiiw.
    7. Sourafel Girma & Richard Kneller & Mauro Pisu, 2005. "Exports versus FDI: An Empirical Test," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 141(2), pages 193-218, July.
    8. Nigel Driffield & Karl Taylor, 2002. "Spillovers from FDI and Skill Structures of Host-Country Firms," Discussion Papers in Economics 02/4, Department of Economics, University of Leicester.
    9. Gustavo J. Bobonis & Howard J. Shatz, 2007. "Agglomeration, Adjustment, and State Policies in the Location of Foreign Direct Investment in the United States," The Review of Economics and Statistics, MIT Press, vol. 89(1), pages 30-43, February.
    10. Dees, Stephane, 1998. " Foreign Direct Investment in China: Determinants and Effects," Economic Change and Restructuring, Springer, vol. 31(2-3), pages 175-94.
    11. Nair-Reichert, Usha & Weinhold, Diana, 2001. " Causality Tests for Cross-Country Panels: A New Look at FDI and Economic Growth in Developing Countries," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 63(2), pages 153-71, May.
    12. Markusen, James R. & Venables, Anthony J., 1998. "Multinational firms and the new trade theory," Journal of International Economics, Elsevier, vol. 46(2), pages 183-203, December.
    13. Nigel Driffield, 2001. "Inward investment, industry concentration and the speed of adjustment," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 137(2), pages 193-214, June.
    14. Coughlin, Cletus C & Terza, Joseph V & Arromdee, Vachira, 1991. "State Characteristics and the Location of Foreign Direct Investment within the United States," The Review of Economics and Statistics, MIT Press, vol. 73(4), pages 675-83, November.
    Full references (including those not matched with items on IDEAS)

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:52575. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ekkehart Schlicht)

    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.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with 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 profile, as there may be some citations waiting for confirmation.

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

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.