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A panel data analysis of locational determinants of Chinese and Indian outward foreign direct investment

Guney, Yilmaz; Duanmu, Jing Lin

Authors

Yilmaz Guney

Jing Lin Duanmu



Abstract

The upsurge of Chinese and Indian outward foreign direct investment (FDI) raises an unanswered question about locational determinants of direct investment from the two countries. Using an unbalanced bilateral FDI database, we find that Chinese and Indian FDI are attracted to countries with large market size, low GDP growth, high volumes of imports from China or India, and low corporate tax rates. We also find important differences between China and India. While Chinese FDI is drawn to countries with open economic regimes, depreciated host currencies, better institutional environments, and English speaking status, none of these factors are important for Indian FDI. Chinese FDI is also deterred by geographic distance and OCED membership. However, neither of these has any impact on Indian FDI. © 2009, Emerald Group Publishing Limited

Citation

Guney, Y., & Duanmu, J. L. (2009). A panel data analysis of locational determinants of Chinese and Indian outward foreign direct investment. Journal of Asia Business Studies, 3(2), 1-15. https://doi.org/10.1108/15587890980001512

Journal Article Type Review
Publication Date May 21, 2009
Deposit Date Nov 13, 2014
Journal Journal of Asia business studies
Print ISSN 1558-7894
Publisher Emerald
Peer Reviewed Peer Reviewed
Volume 3
Issue 2
Pages 1-15
DOI https://doi.org/10.1108/15587890980001512
Keywords Strategy and Management; Business and International Management; General Economics, Econometrics and Finance
Public URL https://hull-repository.worktribe.com/output/463794
Publisher URL https://www.emeraldinsight.com/doi/abs/10.1108/15587890980001512
Contract Date Nov 13, 2014