International Experience and the Performance of Scandinavian Firms in China

Johan Carlsson, Axel Nordegren and Fredrik Sjoholm ()
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Johan Carlsson: Stockholm School of Economics, Postal: Stockholm School of Economics, P.O. Box 6501, S-113 83 Stockholm, Sweden
Axel Nordegren: Stockholm School of Economics, Postal: Stockholm School of Economics, P.O. Box 6501, S-113 83 Stockholm, Sweden

No 188, EIJS Working Paper Series from The European Institute of Japanese Studies

Abstract: Western firms locating in China face a business environment that differs from their home country environment. The differences increase uncertainties and are negative for economic performance. However, firms may differ in their ability to overcome the difficulties, depending on their previous experience. In particular, firms with experience from regions similar to China might do comparably well. We conduct a survey of Scandinavian firms with subsidiaries in China to examine their economic performance. Our results show that subsidiaries in China perform better if the firms have subsidiaries in Hong Kong, Taiwan, or Singapore. In addition, the length of subsidiaries’ operation in China, and the experience from foreign countries outside of Greater China, are also positively affecting the subsidiaries’ economic performance.

Keywords: FDI; Firms; Experience; China; Scandinavia (search for similar items in EconPapers)
JEL-codes: F20 F23 M20 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ifn
Date: 2004-02-01
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Persistent link: http://EconPapers.repec.org/RePEc:hhs:eijswp:0188

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