Chinese economic development, the next stage: outward FDI?

Expanding to outward foreign direct investment or not? A multi-dimensional analysis of entry mode transformation of Chinese private exporting firms

“…Existing research has found that motives for acquiring external knowledge affects the path of internationalisation, and OFDI activities provide a means of knowledge exploitation and exploration in foreign countries (Lu et al, 2011;Meyer et al, 2009b). In comparison, exporting activities only allow firms to have limited interaction with foreign buyers and suppliers, representing limited learning opportunities in international markets (Liu et al, 2005). Thus, we hypothesise Hypothesis 6: Exporting firms operating in an industry characterised by high R&D are more likely to expand to OFDI and undertake more VFDI.…”

“…For most of their international market forays, Chinese firms' internationalisation is still at an early stage and is primarily dominated by exporting (Child & Rodrigues, 2005;Liu, Buck & Shu, 2005). Exporting is a relatively lower business risk activity, requires fewer resource commitments, and has greater flexibility for managerial actions than OFDI.…”

State ownership effect on firms' FDI ownership decisions under institutional pressure: a study of Chinese outward-investing firms

“…Both items were cleanly loaded on one factor. These two home country institutional procedures are highlighted in recent studies of Chinese outward FDI (Deng, 2004;Liu, Buck, & Shu, 2005;Luo et al, 2010). Host regulatory pressure was measured by three items describing host country policy pressure on inward FDI, foreign firm operation, and equity-based market entry (α=0.92).…”

The Pitfalls of Using Foreign Direct Investment Data to Measure Chinese Multinational Enterprise Activity

“…77 Similarly, Liu, Buck and Shu (2005) also note that "trade and services dominate the picture" of Chinese OFDI. 78 Cheung & Qian (2009) remark: "Two observations stand out: the growth of the trade and trade services sector and the fading importance of the manufacturing sector." 79 Even , who are generally far more careful with their use of OFDI data than others, do not relate the high level of business services to the industrial composition biases created by SPEs in THOFCs.…”