The impact of outward FDI on the performance of Chinese multinationals
Claudio Cozza (),
Roberta Rabellotti () and
Marco Sanfilippo ()
No 24/2014, BOFIT Discussion Papers from Bank of Finland, Institute for Economies in Transition
Using a new firm-level database, EMENDATA, this paper investigates the effects on Chinese multinational enterprises of Outward FDI (OFDI) into advanced European countries. Propensity score matching is combined with a difference-in-difference estimator to reduce the problems of self-selection of treated firms in foreign markets and to eliminate time-invariant and unobservable differences between those firms and the controls. The results provide robust evidence in support of the view that China’s OFDI had so far a positive impact on domestic activities in enhancing firms’ productivity and scales of operation, as measured by assets, sales and employment. Distinguishing among such investments on the basis of entry mode shows that acquisitions facilitate early access to intangible assets but are detrimental to financial performance, whereas greenfield investments have a positive impact on the scale and productivity of Chinese investors. Publication keywords: outward FDI, reverse spillovers, performance, Chinese multinationals
JEL-codes: F45 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cse, nep-eff, nep-int and nep-sbm
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Published in Published in China Economic Review, Volume 36, December 2015, Pages 42–57 as The impact of outward FDI on the performance of Chinese firms.
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Persistent link: https://EconPapers.repec.org/RePEc:bof:bofitp:2014_024
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