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FDI in Chinese Cities: Spillovers and Impact on Growth

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  • Nicole Madariaga
  • Sandra Poncet

Abstract

This study reconsiders the question of impact of FDI on growth performance. We rely on a dataset of Chinese cities between 1990 and 2002 to investigate the effects of FDI in the traditional growth regression framework using the GMM estimator for dynamic panels. Our growth model incorporates an explicit consideration of spatial dependence effects in the form of spatially lagged income and FDI. Our results reveal that Chinese cities take advantage not only of FDI flows received locally but also of FDI flows received by their neighbours.

Suggested Citation

  • Nicole Madariaga & Sandra Poncet, 2007. "FDI in Chinese Cities: Spillovers and Impact on Growth," The World Economy, Wiley Blackwell, vol. 30(5), pages 837-862, May.
    • Handle: RePEc:bla:worlde:v:30:y:2007:i:5:p:837-862
    DOI: 10.1111/j.1467-9701.2007.01025.x
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    More about this item

    JEL classification:

    • E10 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - General
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • O50 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - General
    • R10 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General

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