The role of FDI in domestic exporting: Evidence from China

Journal Publication ResearchOnline@JCU
Sun, Sizhong
Sizhong Sun
Abstract

This paper investigates the impact of FDI on domestic exporting firms. We show that domestic firms respond to an increase in the presence of FDI by increasing their exports even though the increase in foreign presence can drive up production costs and make the domestic market more profitable. Our test case for this hypothesis is China, where we confirm the significant positive impact of FDI on domestic firms' exports. This finding sheds light on the massive exports and rapid inflow of foreign investment that have been observed in China in the past three decades.

Journal

Journal of Asian Economics

Publication Name

Journal of Asian Economics

Volume

23

ISBN/ISSN

1873-7927

Edition

N/A

Issue

4

Pages Count

8

Location

N/A

Publisher

Elsevier

Publisher Url

N/A

Publisher Location

N/A

Publish Date

N/A

Url

N/A

Date

N/A

EISSN

N/A

DOI

10.1016/j.asieco.2012.03.004