Abstract
ABSTRACT The presence of Chinese multinational enterprises (MNEs) in Europe is on the rise, yet they concentrate in specific regions. Traditional spatial explanations of this clustering refer to the co-location of foreign and local firms in the same or related sectors (‘industry agglomeration’). Nonetheless, Chinese investors may also favour locations with a presence of Chinese firms and ethnic communities (‘country-of-origin agglomeration’). We investigate the combined role of both agglomeration typologies by using data on 1307 Chinese investments in 176 NUTS-2 regions during the period 2009–19. While both agglomerations matter in general, we find a substitution effect of country-of-origin agglomeration offsetting the benefits of industry agglomeration.
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