Does the Number of Exporting Firms Expands China’s Strategic Path of Outward Foreign Direct Investment?
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Abstract By applying the Foreign Economic Model based on the hypothesis of enterprise heterogeneity, it is found that the level of China’s Outward Foreign Direct Investment (OFDI) in the host country will depend on OFDI and trade cost difference between home country and host country, the host country’s cost of production, the host country’s market size and the host country’s number of exporting firms. This paper conducts a panel analysis based on the data of China’s OFDI in 103 countries or regions during 2006-2012, emphasis on the relationship between foreign direct investment and the number of exporting firms. The multiple linear regression model shows that the number of exporting firms, trade costs, China’s imports for the host country, the distance between China and the host country, the protection of trade and commerce in the host country, the degree of market opening in host country are the main contributors that affect China’s OFDI. Particularly reflecting the fact that increase in the number of exporting firms promotes OFDI by the number of extensive margin utility.
WANG Fang-Fang,SHAO Dan. Does the Number of Exporting Firms Expands China’s Strategic Path of Outward Foreign Direct Investment?. Economic Survey, 2016, 33(5): 060.
2016, Vol. 33 
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