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Knowledge Spillovers from FDI in the People's Republic of China: The Role of Educated Labor in Multinational Enterprises


  • Todo, Yasuyuki

    (Asian Development Bank Institute)

  • Zhang, Weiying

    (Asian Development Bank Institute)

  • Zhou, Li-An

    (Asian Development Bank Institute)


This paper employs a firm-level panel data set for a high-tech cluster in the People's Republic of China to examine knowledge spillovers from multinational enterprises (MNEs) to domestic firms, focusing on the role of MNEs' employment of educated workers. We find that knowledge within MNEs spills over to domestic firms in the same industry through MNEs' employment of workers with graduate-level or overseas education. We also find that Japanese MNEs contribute less to knowledge spillovers than United States MNEs. This is most likely due to the fact that Japanese MNEs in the People's Republic of China do not employ as much educated labor.

Suggested Citation

  • Todo, Yasuyuki & Zhang, Weiying & Zhou, Li-An, 2009. "Knowledge Spillovers from FDI in the People's Republic of China: The Role of Educated Labor in Multinational Enterprises," ADBI Working Papers 174, Asian Development Bank Institute.
  • Handle: RePEc:ris:adbiwp:0174

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    References listed on IDEAS

    1. Geest, Willem van der & Nunez-Ferrer, Jorge, 2011. "Appropriate Financial Instruments for Public-Private Partnership to Boost Cross-Border Infrastructural Development-EU Experience," ADBI Working Papers 281, Asian Development Bank Institute.
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    Cited by:

    1. Fariha Kamal, 2014. "Does Firm Ownership Affect Spillover Opportunities? Evidence From Chinese Manufacturing," Journal of Regional Science, Wiley Blackwell, vol. 54(1), pages 137-154, January.
    2. Salike, Nimesh, 2016. "Role of human capital on regional distribution of FDI in China: New evidences," China Economic Review, Elsevier, vol. 37(C), pages 66-84.
    3. Ziliang Deng & Honglin Guo & Guilan Kong, 2011. "Efficiency Spillovers of Foreign Direct Investment in the Chinese Banking System," Global Economic Review, Taylor & Francis Journals, vol. 40(2), pages 179-191.
    4. Nguyen-Huu, Thanh Tam & Nguyen-Khac, Minh, 2017. "Impacts of export-platform FDI on backward linkages - Do third country size, trade agreements and heterogeneity of firms matter? Evidence from the Vietnamese supporting industries," Economics Discussion Papers 2017-21, Kiel Institute for the World Economy (IfW).

    More about this item


    knowledge spillovers; foreign direct investment; educated labor; the peoples republic of china;

    JEL classification:

    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General

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