Institutions and Foreign Direct Investment : China versus the Rest of the World
Weak institutions impede foreign direction investment (FDI), yet China attracts massive FDI despite global media spotlighting its institutional infirmities. Standard institutional quality variables poorly track rapid transformations, like China's regime shift following Den Xiaoping's 1993 Southern Tour. Economy track record usefully augments these variables in such cases. Cross-country regressions controlling for institutional quality and economy track record reveal China's FDI inflow unexceptional. Rather, China's FDI inundation resembles analogous post-reform East Bloc events. Arguments that China's FDI inflow is inefficiently large because weak institutions deter domestic investment while special initiatives attract FDI are thus either unsupported or not unique to China.
| Main Authors: | , , , |
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| Format: | Journal Article biblioteca |
| Language: | EN |
| Published: |
2009
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| Subjects: | International Investment, Long-term Capital Movements F210, Multinational Firms, International Business F230, Economic Development: Financial Markets, Saving and Capital Investment, Corporate Finance and Governance O160, International Linkages to Development, Role of International Organizations O190, Socialist Systems and Transitional Economies: Planning, Coordination, and Reform P210, Socialist Institutions and Their Transitions: International Trade, Finance, Investment, and Aid P330, Socialist Institutions and Their Transitions: Financial Economics P340, |
| Online Access: | http://hdl.handle.net/10986/5713 |
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