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The Relationship between Domestic Investment and Outward Foreign Direct Investment: Evidences from China

Zhang, Jin and Dai, Jiayuan (2011)
Department of Business Administration
Abstract
Since the strategy of “Going Global” to be implemented, the Chinese OFDI has been increased rapidly. For a long time, governments in developed countries as well as some scholars hold the different attitudes that OFDI will crowd out Chinese domestic
5
investment. In this study, we empirically analyze this relationship between OFDI and domestic investment in China based on the data from 1986 to 2010, we use unit root test, Johansen cointegration test and structure the cointegration model in the time series nanalysis. What’s more, we apply Hausman test and use random and fixed effect model in the panel data research. Both results from time series data and panel data analysis show that OFDI has a significant promoting effect on the domestic... (More)
Since the strategy of “Going Global” to be implemented, the Chinese OFDI has been increased rapidly. For a long time, governments in developed countries as well as some scholars hold the different attitudes that OFDI will crowd out Chinese domestic
5
investment. In this study, we empirically analyze this relationship between OFDI and domestic investment in China based on the data from 1986 to 2010, we use unit root test, Johansen cointegration test and structure the cointegration model in the time series nanalysis. What’s more, we apply Hausman test and use random and fixed effect model in the panel data research. Both results from time series data and panel data analysis show that OFDI has a significant promoting effect on the domestic investment. Investing abroad would bring more domestic investment opportunities in China in both short and long terms during the whole period in the case of overall and divided periods. By analyzing results from different regions, we find that the situation is in line with the country level. And the destinations of OFDI make no difference to the effect of OFDI on GDI. (Less)
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author
Zhang, Jin and Dai, Jiayuan
supervisor
organization
year
type
H1 - Master's Degree (One Year)
subject
keywords
OFDI, Gross domestic investment, Cointegration test, Hausman test, China, Management of enterprises, Företagsledning, management
language
Swedish
id
2061382
date added to LUP
2011-06-01
date last changed
2012-04-02 19:00:33
@misc{2061382,
  abstract     = {Since the strategy of “Going Global” to be implemented, the Chinese OFDI has been increased rapidly. For a long time, governments in developed countries as well as some scholars hold the different attitudes that OFDI will crowd out Chinese domestic
5
investment. In this study, we empirically analyze this relationship between OFDI and domestic investment in China based on the data from 1986 to 2010, we use unit root test, Johansen cointegration test and structure the cointegration model in the time series nanalysis. What’s more, we apply Hausman test and use random and fixed effect model in the panel data research. Both results from time series data and panel data analysis show that OFDI has a significant promoting effect on the domestic investment. Investing abroad would bring more domestic investment opportunities in China in both short and long terms during the whole period in the case of overall and divided periods. By analyzing results from different regions, we find that the situation is in line with the country level. And the destinations of OFDI make no difference to the effect of OFDI on GDI.},
  author       = {Zhang, Jin and Dai, Jiayuan},
  keyword      = {OFDI,Gross domestic investment,Cointegration test,Hausman test,China,Management of enterprises,Företagsledning, management},
  language     = {swe},
  note         = {Student Paper},
  title        = {The Relationship between Domestic Investment and Outward Foreign Direct Investment: Evidences from China},
  year         = {2011},
}