Is There Evidence of FDI Spillover on Chinese Firms' Productivity and Innovation? PDF Download
Are you looking for read ebook online? Search for your book and save it on your Kindle device, PC, phones or tablets. Download Is There Evidence of FDI Spillover on Chinese Firms' Productivity and Innovation? PDF full book. Access full book title Is There Evidence of FDI Spillover on Chinese Firms' Productivity and Innovation? by Galina Hale. Download full books in PDF and EPUB format.
Author: Galina Hale
Publisher:
ISBN:
Category :
Languages : en
Pages : 37
Get Book Here
Book Description
We review previous literature on productivity spillovers of foreign direct investment (FDI) in China and conduct our own analysis using a cross--section of firm data. We find that the evidence of FDI spillovers on the productivity of Chinese domestic firms is mixed, with many positive results largely due to aggregation bias or failure to control for endogeneity of FDI. Attempting over 2500 specifications which take into account forward and backward linkages, we find no evidence of systematic positive productivity spillovers from FDI. We do, however, find robust evidence that Chinese private firms tend to invest less in innovation in the presence of FDI. Combined with our previous findings that domestic private firms tend to be more involved in providing inputs and intermediary goods for foreign firms (Hale and Long, 2006), these results suggest a more passive role played by domestic firms in the global division of labor than envisioned by the Chinese government.
Author: Galina Hale
Publisher:
ISBN:
Category :
Languages : en
Pages : 37
Get Book Here
Book Description
We review previous literature on productivity spillovers of foreign direct investment (FDI) in China and conduct our own analysis using a cross--section of firm data. We find that the evidence of FDI spillovers on the productivity of Chinese domestic firms is mixed, with many positive results largely due to aggregation bias or failure to control for endogeneity of FDI. Attempting over 2500 specifications which take into account forward and backward linkages, we find no evidence of systematic positive productivity spillovers from FDI. We do, however, find robust evidence that Chinese private firms tend to invest less in innovation in the presence of FDI. Combined with our previous findings that domestic private firms tend to be more involved in providing inputs and intermediary goods for foreign firms (Hale and Long, 2006), these results suggest a more passive role played by domestic firms in the global division of labor than envisioned by the Chinese government.
Author: Ziliang Deng
Publisher: Routledge
ISBN: 113667263X
Category : Business & Economics
Languages : en
Pages : 289
Get Book Here
Book Description
This book provides an insightful exploration of whether foreign direct investment (FDI) can promote the productivity of domestic enterprises. The book is based on a series of dedicated research conducted in the context of the Chinese economy, which has been the largest FDI host among the developing economies since 1993. The main themes of this book are (a) based on the latest literature and first-hand research, outlining possible mechanisms through which foreign direct investment could promote the productivity of domestic enterprises; (b) developing a comprehensive research framework to quantify the spillover effects with cutting-edge methodology; (c) constructing a decision support system for evaluating FDI policy reforms with advanced computer simulation techniques; (d) evaluating the broader impact of FDI spillovers on banking system and trade pattern. The book examines topical economic issues in the contemporary world economy from innovative perspectives, namely, how the presence of multinational enterprises has been one of the most important microeconomic drivers for the Chinese economy, how foreign banks have helped to enable Chinese banking system survive the global financial crisis, and how the domestic enterprises have learned to do exports from multinational affiliates and have changed the landscape of U.S.-Asian trade. The book incorporates the latest development of economic theory as well as computational economics model.
Author: Jim Huangnan Shen
Publisher:
ISBN:
Category :
Languages : en
Pages : 24
Get Book Here
Book Description
This paper constructs a two-stage sequential game model to investigate the spillover effect of inward FDI on improving the efficiency of domestic firms in host countries. Our model shows that, given the optimal joint-venture policy made by foreign firms, the impact of spillover effect of inward FDI is contingent upon the productivity gap between the domestic firms and foreign ones. In particular, we demonstrate that the spillover effect of FDI inward varies negatively with the productivity gap between domestic low-productivity firms and foreign firms and works conversely for high-productivity firms. This result suggests that once the productivity gap widens, the entry of foreign firms will increase the efficiency of high-productivity firms and reduce the efficiency of low-productivity firms. The implication of our theoretical predictions is that once the productivity of domestic firms (high-productivity firms) is close enough to the world productivity frontier, they will incur the positive spillover effect from the entry of foreign firms. In contrast, the domestic firms with low productivity which are more distant from the world productivity frontier will perform worse owing to the entry of foreign firms, thus leading to the negative spillover effect. Using the data from over 570,000 firms in Chinese manufacturing industry in 2011, we advance the understanding of the theoretical model through empirical analysis.
Author: Jing Li
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
Get Book Here
Book Description
We investigate the degree to which the presence of inward foreign direct investments (FDI) influences product innovation by emerging market firms. We begin with FDI spillover effects at the national level, the common approach in the literature. We further examine spillover effects at the sub-national level, because knowledge spillovers have been found to be localized. We study both intra-industry and inter-industry FDI spillovers in a sub-national location, based on the distinction in the cluster literature between Marshall-Arrow-Romer (MAR) specialization externalities and Jacobian diversification externalities. Using information from more than 346,000 Chinese manufacturing firms from 2000 to 2006, we find that Chinese firms improve their product innovations when they are located in cities, with concentrated foreign innovative activities in the same industry. These intra-industry spillover benefits decrease quickly, however, as the foreign presence increases and, at high levels of foreign concentration, are dominated by the crowding-out effect. We also find evidence of inter-industry spillover benefits in a city; diversity of industries with a foreign presence contributes to product innovation by Chinese firms.
Author: Galina Hale
Publisher:
ISBN:
Category :
Languages : en
Pages : 34
Get Book Here
Book Description
We review previous literature on productivity spillovers of foreign direct investment (FDI) in China and conduct our own analysis using a firm-level data set from a World Bank survey. We find that the evidence of FDI spillovers on the productivity of Chinese domestic firms is mixed, with many positive results largely due to aggregation bias or failure to control for endogeneity of FDI. Attempting over 2500 specifications which take into account forward and backward linkages, we fail to find evidence of systematic positive productivity spillovers from FDI.
Author: Yan Liu
Publisher:
ISBN:
Category :
Languages : en
Pages : 40
Get Book Here
Book Description
This paper studies the impact of foreign direct investment on domestic firms' innovation in China. It provides causal evidence by exploiting China's foreign direct investment deregulation in 2002 and employs a difference-in-difference estimation strategy. Using a matched firm-patent data set from 1998 to 2007, the results show that the quantity and quality of domestic firms' innovation benefit from foreign direct investment. Moreover, the paper emphasizes the importance of knowledge spillover from foreign direct investment in similar technology domains. The analysis examines the role of horizontal foreign direct investment and foreign direct investment in technologically close industries'industries that share similar technology domains. The findings show that foreign direct investment in technologically close industries generates much bigger positive spillovers than horizontal foreign direct investment. The paper also shows that knowledge spillover from foreign direct investment in similar technology domains is not driven by input-out linkages. Moreover, the spillover effect is stronger in cities with higher human capital stock and firms with higher absorptive capacity.
Author: Thomas Farole
Publisher: World Bank Publications
ISBN: 1464801266
Category : Business & Economics
Languages : en
Pages : 302
Get Book Here
Book Description
This book presents the results of a groundbreaking study on ‘spillovers’ of knowledge and technology from global value-chain oriented foreign direct investment (FDI) in Sub-Saharan Africa, and discusses implications for policymakers hoping to harness the power of FDI for economic development.
Author: Lin Zhang
Publisher:
ISBN:
Category :
Languages : en
Pages : 25
Get Book Here
Book Description
As China is moving toward an innovation-driven economy, this paper offers new insights for both policymakers and investors to optimize the effectiveness of investment performance. This paper studies China's provincial research activities with a focus on the spillover-induced productivity and efficiency change. The results show that spillovers as a result of inflow of foreign investment contribute positively to the performance of overall research activities, however, the productivity effects vary across regions. Our analysis also indicates that highly skewed distribution of FDI leads to a less improved innovation efficiency in FDI-rich provinces. Future innovation policy should adjust the investment profiles based on the preferential innovation output on one hand, and optimize the complementary policy for FDI on the other hand to reduce inefficiency and the potential negative effects of knowledge spillovers. Inter-provincial governmental cooperation is necessary to resolve the uneven distribution of FDI and improve the innovation efficiency in both FDI-poor and rich regions.
Author: Miroslav Jovanovic
Publisher: Routledge
ISBN: 1134098464
Category : Business & Economics
Languages : en
Pages : 536
Get Book Here
Book Description
The purpose of this book is to provide a guided tour through the theoretical foundations of spatial locations of firms and industries in an evolutionary economic framework. It addresses the issues of how a location of business in geographical space is selected and where economic activity may (re)locate in the future. The analysis is in the context
Author: Luosha Du
Publisher:
ISBN:
Category : Economics
Languages : en
Pages : 0
Get Book Here
Book Description
A number of recent studies examine productivity spillovers from foreign direct investment (FDI) to China's domestic industrial enterprises. This study goes further by investigating the implications of institutions for the nature of productivity spillovers during 1998-2007. We examine three institutional features that comprise aspects of China's "special characteristics": (1) the different sources of FDI, where FDI is nearly evenly divided between mostly Organization for Economic Co-operation and Development (OECD) countries and the region known as "Greater China", consisting of Hong Kong, Taiwan, and Macau; (2) China's heterogeneous ownership structure, involving state- (SOEs) and non-state owned (non-SOEs) enterprises, firms with foreign equity participation, and non-SOE, domestic firms; and (3) industrial promotion via tariffs or through tax holidays to foreign direct investment. We also explore how productivity spillovers from FDI changed with China's entry into the WTO in late 2001. We find robust positive and significant spillovers to domestic firms via backward linkages (the contacts between foreign buyers and local suppliers). Our results suggest varied success with industrial promotion policies. Final goods tariffs as well as input tariffs are negatively associated with firm-level productivity. However, we find that productivity spillovers were higher from foreign firms that paid less than the statutory corporate tax rate.
