Internationalization Pathways of Chinese Private Firms: A Closer Look at Firm-Specific Advantages

Nigel Driffield, Jun Du, Meng Song*

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

Abstract

Using a unique date set, we explore the internationalization processes of Chinese private sector firms. We show that variations in internationalization of private Chinese firms can be better explained by traditional internationalization theories than by the typical approach proposed in the recent literature that centers on state-created advantages. The firm-specific advantages of productivity, proprietary knowledge, and technology competence explain Chinese private foreign direct investment (FDI) in a similar way as they do typical FDI from western developed countries. Further, firm-specific advantages such as technology leadership, exporting experience, and ability to signal quality to partners abroad can explain differently motivated outward FDI by private Chinese firms. Our results fill an important gap in the literature, where the validity of the existing frameworks for explaining the internationalization of Chinese multinationals is hampered by the conflation of state-sponsored internationalization, knowledge-seeking FDI, and firm-specific advantages.
Original languageEnglish
Article number100835
JournalJournal of International Management
Early online date13 May 2021
DOIs
Publication statusE-pub ahead of print - 13 May 2021

Bibliographical note

© 2021, Elsevier. Licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International http://creativecommons.org/licenses/by-nc-nd/4.0/

Keywords

  • Emerging market multinationals
  • Chinese multinationals
  • Internationalization

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