The role of regional formal institutions in China's OFDI location choice and firm performance - The moderation roles of international experience and foreign capital utilization

Asia and the Global Economy Pub Date : 2022-01-01 DOI:10.1016/j.aglobe.2022.100029

Yi Qu , Andrzej Cieślik , Runze Zhang , Shuo Zhao , Nannan Ban

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Abstract

Based on the micro data of Chinese enterprises, this paper examines the effects of regional formal institutional environment in China on the location choice and firm performance of Chinese OFDI, and discusses the roles played by international experience and the foreign capital usage. The results show that regional formal institutional environment of China significantly and positively affects the location choice and performance of Chinese OFDI. Moreover, different regional formal institutions have varied effects. In particular, institutional factors represented by the ‘government and market relationship’, ‘product market’ and ‘factor market’ development play the key role. It is also found that actual FDI utilization and firms’ international experience play positive and significant moderation roles in the institutional effect on China's OFDI, but such moderation effects are constrained to ‘intermediary organizations and legal environment’ as the institutional factor only. Therefore, the policy of improving regional institutional quality can have a positive effect on OFDI and corporate performance.

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区域正规制度在中国对外直接投资区位选择和企业绩效中的作用——国际经验和外资利用的调节作用

本文基于中国企业的微观数据，考察了中国区域正规制度环境对中国对外直接投资区位选择和企业绩效的影响，并讨论了国际经验和外资利用在其中的作用。结果表明，中国区域正式制度环境显著正向影响中国对外直接投资的区位选择和绩效。此外，不同地区的正式制度具有不同的效果。其中，以“政府与市场关系”、“产品市场”和“要素市场”为代表的制度因素发挥了关键作用。研究还发现，实际FDI利用和企业国际经验对中国对外直接投资的制度效应具有显著的正向调节作用，但这种调节作用仅限于“中介组织和法律环境”这一制度因素。因此，提高区域制度质量的政策可以对对外直接投资和企业绩效产生积极的影响。

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Asia and the Global Economy

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