Chinese Returnees and High-tech Sector Outward FDI: The Case of Changzhou

Zhao Chen () and Tony Fang
Additional contact information
Zhao Chen: Fudan University, China

No 10045, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: The rapid growth and high levels of internationalization by Chinese firms, raise a natural interest in the study of the factors which have led the notable international presence of Chinese firms. To contribute to this effort, we use data from the 2008-10 survey of China's High-tech firms, conducted by the Chinese Ministry of Science and Technology, to estimate the determinants of Chinese firm outward FDI (OFDI). In our analysis, the primary independent variables include high-tech intensity, human capital acquisition, and institutional factors. We have also controlled for various firm characteristics such as firm age, total value of fixed assets, and firm ownership. Estimation from our fixed-effects model uncovers a number interesting patterns in OFDI outcomes. Most notable, among the significant determinants of OFDI, the number of Chinese returnees employed by a firm seems to be more important than tax reduction policies. Further, the effects of the Chinese returnees have a stronger effect on non state-controlled firms than they do for state-controlled firms. This finding is intuitive, since the Chinese returnees who were trained in the West have an understanding of product markets, labour markets, financial markets, language and business culture, and trade laws in both China and the West. Their unique skill sets and knowledge appear to serve as an important catalysts in the growth of OFDI and internationalization by Chinese firms.

Keywords: Chinese firm internationalization; OFDI; panel data (search for similar items in EconPapers)
JEL-codes: F21 F23 M16 (search for similar items in EconPapers)
Pages: 47 pages
Date: 2016-07
New Economics Papers: this item is included in nep-cna, nep-cse, nep-ger, nep-int, nep-sbm and nep-tra
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Published - published in: Asian Economic Papers, 2016, 15 (3), 195-215

Downloads: (external link)
https://docs.iza.org/dp10045.pdf (application/pdf)

Related works:
Journal Article: Chinese Returnees and High-Tech Sector Outward FDI: The Case of Changzhou (2016)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:iza:izadps:dp10045

Ordering information: This working paper can be ordered from
IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany

Access Statistics for this paper

More papers in IZA Discussion Papers from Institute of Labor Economics (IZA) IZA, P.O. Box 7240, D-53072 Bonn, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Holger Hinte ().