Does foreign direct investment facilitate technological progress?: Evidence from Chinese industries

Xiaohui Liu; Chenggang Wang

doi:10.1016/S0048-7333(02)00094-X

Does foreign direct investment facilitate technological progress? Evidence from Chinese industries

Xiaohui Liu^*, Chenggang Wang

^*Corresponding author for this work

Aston Business School

Research output: Contribution to journal › Article › peer-review

Abstract

This paper studies the impact of foreign direct investment (FDI) on total factor productivity (TFP) for a cross sectional sample of Chinese industrial sectors. The possible determinants of TFP are sought with special focus on FDI. An endogeneity test is performed in order to avoid inconsistent results. Evidence indicates that foreign presence, the level of R&D and the firm size are the most important factors enhancing TFP in Chinese industries. The findings from this study support the argument that attracting FDI is an effective way of introducing advanced technology to host countries.

Original language	English
Pages (from-to)	945-953
Number of pages	9
Journal	Research policy
Volume	32
Issue number	6
DOIs	https://doi.org/10.1016/S0048-7333(02)00094-X
Publication status	Published - 1 Jun 2003

Keywords

Chinese industries
Foreign direct investment
Technological progress
Total factor productivity

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10.1016/S0048-7333(02)00094-X

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AB - This paper studies the impact of foreign direct investment (FDI) on total factor productivity (TFP) for a cross sectional sample of Chinese industrial sectors. The possible determinants of TFP are sought with special focus on FDI. An endogeneity test is performed in order to avoid inconsistent results. Evidence indicates that foreign presence, the level of R&D and the firm size are the most important factors enhancing TFP in Chinese industries. The findings from this study support the argument that attracting FDI is an effective way of introducing advanced technology to host countries.

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Does foreign direct investment facilitate technological progress? Evidence from Chinese industries

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Keywords

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