When Facts Fail: Experimental Evidence on Perceptions and Preferences towards Chinese Investments in Germany

Zhexun Mo, Katharina Kaeppel, Carsten Schröder and Li Yang

No 74k3v_v1, SocArXiv from Center for Open Science

Abstract: This paper investigates how the German public perceives Chinese Foreign Direct Investment (FDI) amid escalating geopolitical tensions and deepening China–EU economic interdependence, complemented by evidence on Chinese perceptions of German FDI. We combine data from a large-scale survey experiment embedded in the 2023 German Socio-Economic Panel Innovation Sample (N = 2,365) with a descriptive survey in China (N = 2,000). German respondents substantially overestimate the scale of Chinese investment—believing it accounts for about 30% of total inward FDI, compared to an actual share of roughly 1%—and evaluate it significantly less favorably than investment from other EU countries or the United States. In contrast, Chinese respondents express consistently positive views of German FDI, revealing a pronounced asymmetry in mutual perceptions. To probe the origins and malleability of these views, we implement three randomized interventions in Germany: a factual correction of actual FDI shares and two narrative framings emphasizing either positive or negative aspects of Chinese investment. While factual information modestly improves perceptions of FDI’s economic benefits, none of the treatments meaningfully shift deeper, ideologically anchored attitudes toward Chinese investment. Quantile treatment effect analyses indicate, however, that these interventions reduce anti-China biases among respondents who are initially more receptive to Chinese FDI. Taken together, the results—consistent across direct evaluations, conjoint choice experiments, and Willingness-to-Accept (WTA) measures—underscore the limits of informational interventions in reshaping entrenched geopolitical or identity-based biases toward foreign investment. (Stone Center on Socio-Economic Inequality Working Paper)

Date: 2025-10-29
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Persistent link: https://EconPapers.repec.org/RePEc:osf:socarx:74k3v_v1

DOI: 10.31219/osf.io/74k3v_v1

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