IDEAS home Printed from
   My bibliography  Save this paper

The distribution of foreign direct investment in China


  • Broadman, Harry G.
  • Xiaolun Sun


Foreign direct investment (FDI) has played a major role in China's push toward a market-oriented economy. Recent inflows account for 40 percent of combined flows of FDI to all developing countries, making China the biggest developing country FDI recipient. This record is impressive, but certain problems must be overcome if FDI is to continue to help sustain the country's record growth rate and further its economic development. For one thing, FDI in China is highly concentrated geographically, and its sector distribution is highly uneven. The authors empirically analyze the geographic determinants of FDI in China. They find that FDI's geographical distribution in China is determined mostly by GNP, infrastructure development, level of general education, and coastal location. Althoughthe sectoral distribution of FDI is coming into line with the rest of the world, in the past, FDI has been biased toward speculative types of investment, especially in the real estate sector.

Suggested Citation

  • Broadman, Harry G. & Xiaolun Sun, 1997. "The distribution of foreign direct investment in China," Policy Research Working Paper Series 1720, The World Bank.
  • Handle: RePEc:wbk:wbrwps:1720

    Download full text from publisher

    File URL:
    Download Restriction: no

    References listed on IDEAS

    1. Jonathan Gruber & James M. Poterba, 1996. "Tax Subsidies to Employer-Provided Health Insurance," NBER Chapters,in: Empirical Foundations of Household Taxation, pages 135-168 National Bureau of Economic Research, Inc.
    2. Woodbury, Stephen A & Hamermesh, Daniel S, 1992. "Taxes, Fringe Benefits and Faculty," The Review of Economics and Statistics, MIT Press, vol. 74(2), pages 287-296, May.
    3. J Martinez-Vazquez, 1994. "The challenge of expenditure-assignment reform in Russia," Environment and Planning C: Government and Policy, Pion Ltd, London, vol. 12(3), pages 277-292, June.
    4. Horioka, Charles Yuji, 1994. "Japan's Consumption and Saving in International Perspective," Economic Development and Cultural Change, University of Chicago Press, vol. 42(2), pages 293-316, January.
    5. Mark E. Schaffer, 1995. "Round table on "Divestiture of social services from state-owned enterprises"," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 3(2), pages 247-250, June.
    6. Kitchen, H., 1993. "Efficient Delivery of Local Government Services," Papers 93-15, Queen's at Kingston - School of Policy Studies.
    Full references (including those not matched with items on IDEAS)


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wbk:wbrwps:1720. 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: (Roula I. Yazigi). General contact details of provider: .

    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.

    We have no references for this item. You can help adding them by using 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 RePEc Author Service 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.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.