Can FDI and ODI two-way flows improve the quality of economic growth? Empirical Evidence from China

Abstract

Different from the existing literature which only studied the unilateral impact of the FDI or the ODI on economic growth, this paper took both the FDI and the ODI into the analysis framework of international capital flow on economic growth, and tried to introduce the mediating effect model to test the transmission mechanism and influence effect of international capital two-way flow on the economic growth. The results showed that both the FDI and the ODI can significantly improve the quality of economic growth, and the role of the FDI was stronger than that of the ODI. At the same time, the FDI and the ODI had obvious regional heterogeneity in promoting the quality of economic growth. International capital flow mainly requires three mediating effects to improve the quality of economic growth, which are the employment, the technology spillover as well as the output efficiency. The three effects of the FDI have a played significant role in promoting the quality of economic growth, while the ODI mainly plays a role through the improvement of output efficiency and technology reverse spillover. There are also significant regional differences in mediating effects.

أثر حوكمة الشركات على العلاقة بین قابلیة الإفصاحات النصیة للقراءة وجذب الاستثمار الأجنبی

“…(Salehi et al, 2020;Kim et al, 2019;Ezat, 2019;Dyer et al, 2017;Bonsall& Miller, 2017) . (Ezat, 2019;Drago et al, 2018;Chen et al, 2015;Riley& Luippold, 2015;Dempsey et al, 2012; (Sun& Xu, 2022;Akisik et al, 2020;Ginesti et al, 2017;Samaha et al, (Luo et al, 2021;Cen et al, 2020;Golubeva, 2020;Blagoev, 2020;Valerievna&Viktorovich, 2018;Wang, 2017…”

The Impact of Two-way FDI on Green Development Quality of the Logistics Industry – Based on the Threshold Effect of Environmental Regulation

“…In the western region, two-way FDI has not had a significant positive impact on the green development quality of the logistics industry. Luo et al [58] used the whole industry's twoway FDI data to examine the impact of two-way FDI on the quality of China's economic growth. The results show that only in the eastern region, two-way FDI significantly improves the quality of economic growth.…”

Foreign direct investment and relative capacity: Theory and evidence

“…Our work differs from the existing studies, such as Li and Liu (2005), Woo (2009), Baltabaev (2014), Herzer and Donaubauer (2018), Li and Tanna (2019), Luo et al (2021), Aziz (2022), and Ciftci and Durusu-Ciftci (2022). Li and Liu (2005) study the importance of the distance to the technological frontier as a factor in benefitting from FDI using a sample of 84 countries, while Woo (2009) analyses the absorptive capacities through FDI based on a panel of over 90 countries.…”