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How does FDI affect China? Evidence from industries and provinces
Journal of Comparative Economics
  • Jimmy RAN, Lingnan University, Hong Kong
  • Jan Piaw, Thomas VOON, Lingnan University
  • Guangzhong LI, Baruch College-CUNY, USA
Document Type
Journal article
Publication Date
  • FDI,
  • Economic growth,
  • Spillover,
  • Industries,
  • Provinces,
  • Net impacts
Using the latest panel data from 19 industries and 30 provinces in China, we found it is not true that more FDI necessarily brings about more output growth across the board. Local industries without foreign participation lose while those with some participation gain from the inflow. Provinces in western and central regions lose while those in the eastern and coastal regions appear to be the major beneficiaries. While the net effect of FDI is still positive, the regional disparity has been growing. It casts doubt on the rationale of haphazard and lavish policies to compete for FDI in China.
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Copyright © 2007 Association for Comparative Economic Studies. Published by Elsevier Inc.

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Citation Information
Ran, J., Voon, J. P., & Li, G. (2007). How does FDI affect China? Evidence from industries and provinces. Journal of Comparative Economics, 35(4), 774-799. doi: 10.1016/j.jce.2007.05.001