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A city-level analysis of the distribution of FDI within China

Suwina Cheng (Department of Accountancy, Lingnan University, Hong Kong, China)
Kenny Lin (Department of Accountancy, Lingnan University, Hong Kong, China)
Richard Simmons (Department of Accountancy, Lingnan University, Hong Kong, China)

Journal of Chinese Economic and Foreign Trade Studies

ISSN: 1754-4408

Article publication date: 6 February 2017

774

Abstract

Purpose

The study aims to examine whether city-level investment climate, local government effectiveness and corporate income tax rates influence the spatial distribution of foreign direct investment (FDI) across cities in China.

Design/methodology/approach

The study uses regression analysis using city-level data sets.

Findings

The study finds that while city-level investment climate and effective local government influence the spatial distribution of FDI across Chinese cities, city-level tax rates have no such influence.

Practical implications

The results have implications for the design of policies aimed at enhancing FDI flows into emerging countries.

Originality/value

To date, few studies have investigated the investment location choice at the city level in a single country. The study contributes to the literature by examining the role of government in such investment decisions. It also adds to the previously limited research examining the role of investment climate at the micro level.

Keywords

Acknowledgements

The authors gratefully acknowledge financial assistance through a Lingnan University Business Faculty Research Grant.

Conflict of Interest: The authors declare that they have no conflict of interest.

Citation

Cheng, S., Lin, K. and Simmons, R. (2017), "A city-level analysis of the distribution of FDI within China", Journal of Chinese Economic and Foreign Trade Studies, Vol. 10 No. 1, pp. 2-18. https://doi.org/10.1108/JCEFTS-01-2016-0002

Publisher

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Emerald Publishing Limited

Copyright © 2017, Emerald Publishing Limited

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