Assessing the Role of Foreign Direct Investment in China’s Economic Development: Macro Indicators and Insights from Sectoral-Regional Analyses

Click here to view record
Main author: Lo, Dic
Format: Monographs and Working Papers           
Online access: Click here to view record


id eprints-109
recordtype eprints
institution SOAS, University of London
collection SOAS Research Online
language English
language_search English
description The objective of this paper is to assess the role of FDI in China’s economic development with reference to the broader literature on FDI and late development. Three main findings come out from the analyses in the paper. First, it is found that FDI tends to promote the improvement in allocative efficiency, while having a negative impact on productive efficiency. Second, insofar as FDI does promote overall productivity growth, this tends to be a matter of cumulative causation rather than one of single-direction causation. Third, in the context of a comparative analysis of two distinctive regional models, it is found that the economic impact of FDI tends to be more favourable in the inward-looking, capital-deepening pattern of development (the ‘Shanghai model’) than that in the export-oriented, labour-intensive pattern (the ‘Guangdong model’). Further analyses, however, suggest that the ‘Shanghai model’ has its intrinsic problems of sustainability. The scope for applying it to China as a whole is thus judged to be limited.
format Monographs and Working Papers
author Lo, Dic
author_facet Lo, Dic
authorStr Lo, Dic
author_letter Lo, Dic
title Assessing the Role of Foreign Direct Investment in China’s Economic Development: Macro Indicators and Insights from Sectoral-Regional Analyses
publisher SOAS Department of Economics Working Paper No. 135
publishDate 2004
url https://eprints.soas.ac.uk/109/

Similar items