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Productivity Spillovers from FDI in the People’s Republic of China: A Nuanced View

id: 2256 Date: 20140603 status: published Times:
Magazines   vol. 31, no. 2, pp. 77–108,2014
AuthorCheryl Xiaoning Long, Galina Hale, Hirotaka Miura
ContentUsing panel data from the Chinese Industrial Surveys of Medium-sized and Large Firms for 2000–2006, we show that the presence and the magnitude of technological spillovers from FDI in the People’s Republic of China are affected by the source of FDI, by the ownership type of a firm in consideration, as well as by industrial and provincial characteristics. Private firms are more likely to benefit from horizontal spillovers than other domestic firms, but are less likely to benefit from vertical ones. Presence of state-owned firms in the industry impedes technological spillovers in a way that is consistent with diversion of linkages from private to state-owned firms. Finally, horizontal spillovers are larger in industries that are more technologically sophisticated.
JEL-CodesL33, F23, O17
KeywordsFDI, spillovers, forward-backward linkages, People’s Republic of China
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