The determinants of Chinese outward foreign direct investment

Peter J Buckley, L Jeremy Clegg, Adam R Cross, Xin Liu, Hinrich Voss and Ping Zheng
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Peter J Buckley: Centre for International Business (CIBUL), Leeds University Business School, University of Leeds, Leeds, UK
L Jeremy Clegg: Centre for International Business (CIBUL), Leeds University Business School, University of Leeds, Leeds, UK
Adam R Cross: Centre for International Business (CIBUL), Leeds University Business School, University of Leeds, Leeds, UK
Xin Liu: Centre for International Business (CIBUL), Leeds University Business School, University of Leeds, Leeds, UK
Hinrich Voss: Centre for International Business (CIBUL), Leeds University Business School, University of Leeds, Leeds, UK
Ping Zheng: Centre for International Business (CIBUL), Leeds University Business School, University of Leeds, Leeds, UK

Journal of International Business Studies, 2007, vol. 38, issue 4, 499-518

Abstract: This study investigates the determinants of Chinese outward direct investment (ODI) and the extent to which three special explanations (capital market imperfections, special ownership advantages and institutional factors) need to be nested within the general theory of the multinational firm. We test our hypotheses using official Chinese ODI data collected between 1984 and 2001. We find Chinese ODI to be associated with high levels of political risk in, and cultural proximity to, host countries throughout, and with host market size and geographic proximity (1984–1991) and host natural resources endowments (1992–2001). We find strong support for the argument that aspects of the special theory help to explain the behaviour of Chinese multinational enterprises. Journal of International Business Studies (2007) 38, 499–518. doi:10.1057/palgrave.jibs.8400277

Date: 2007
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