Heterogeneity and curvilinearity of FDI-related productivity spillovers in China's manufacturing sector

Anwar, Sajid, and Sun, Sizhong (2014) Heterogeneity and curvilinearity of FDI-related productivity spillovers in China's manufacturing sector. Economic Modelling, 41. pp. 23-32.

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Abstract

Earlier studies on foreign direct investment (FDI) have mainly focused on its benefits. This paper examines the nature of FDI-related productivity spillovers in China's manufacturing sector. The empirical analysis based on firm level panel data, over the period 2000–2007, reveals that productivity spillovers arising from FDI from Hong Kong, Macau and Taiwan exhibit not only heterogeneity but also curvilinearity. The size of the spillovers depends on firm age, capital intensity and ownership structure. We find that FDI-related spillovers from the rest of the world are heterogeneous but not curvilinear. We find that the size of productivity spillovers depends on firm size and product quality. The analysis presented in this paper sheds some light on the complex pattern of FDI-related spillovers.

Item ID: 33904
Item Type: Article (Research - C1)
ISSN: 1873-6122
Keywords: FDI, productivity spillovers, heterogeneity, curvilinearity, China's manufacturing sector, panel data analysis
Date Deposited: 08 Jul 2014 23:41
FoR Codes: 14 ECONOMICS > 1402 Applied Economics > 140209 Industry Economics and Industrial Organisation @ 60%
14 ECONOMICS > 1402 Applied Economics > 140210 International Economics and International Finance @ 40%
SEO Codes: 91 ECONOMIC FRAMEWORK > 9102 Microeconomics > 910204 Industry Costs and Structure @ 100%
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