FDI and Local Economic Development: The Case of Taiwanese Investment in Kunshan

A Literature Review of Cluster Theory: Are Relations Among Clusters Important?

“…Countries and regions must provide “reasons,” such as abundant labor resources and excellent infrastructure, in order to attract FDI and MNEs (Jordaan, ). On the other hand, FDI and MNEs are forces that push the development of developing countries (Yamamoto, ; Chen et al ., ). International trade. Cluster firms must consider how to compete and export more in the global market (Belso‐Martinez, ), and how to efficiently utilize cluster advantages (Rodriguez‐Pose et al ., ).…”

“…Countries and regions must provide “reasons,” such as abundant labor resources and excellent infrastructure, in order to attract FDI and MNEs (Jordaan, ). On the other hand, FDI and MNEs are forces that push the development of developing countries (Yamamoto, ; Chen et al ., ).…”

“…Currently, scholars who study cluster phenomena mainly depart either from a microlevel (i.e., studying clusters based on the view of individual cluster firms) or from a mesolevel (i.e., studying clusters based on the view of one cluster). For example, studying why Taiwanese companies like to invest and set up IT firms in the Kunshang IT cluster in mainland China (Chen et al ., ), or studying how and why cluster firms choose their locations (Albert and Casanova, ) belongs to the microlevel, while Krugman's () core‐peripheral model is a representative of mesolevel. Unfortunately, few papers have shed light on how two or more clusters interact with each other.…”

Beyond ‘Shaping up, Shipping out’

“…By implication, a vacuum of competent local suppliers exists. The phenomenon is also highlighted in studies by Yang and Hsia (2007) and Chen et al (2010) on the locational considerations of major Taiwanese IT systems manufacturers before moving to the SCR.…”

Colocation Patterns of Foreign-Owned Firms in a Small Open Economy: Evidence from the Netherlands

“…Firms may also be attracted to the actions of other co-national firms than those of different nations, revealing a type of trait-based imitation. Chen et al (2010) and Yang and Hsia (2007) stress the importance of organizational dynamics of production networks and the asymmetrical power of relations within the supply chains of firms as significant driving forces of similar colocation patterns among firms from the same country of origin. Smaller suppliers from the same country of origin could be forced to establish overseas facilities in close proximity to their key clients' plants abroad to retain their business.…”