Abstract
Outward foreign direct investment (OFDI) from developing countries, like China, has been growing significantly so far. However, there is surprisingly little research on the effects of OFDI on the home county’s entrepreneurship. In this paper, we initially examine the characteristics of China’s OFDI during the country’s economic reform and opening up. We subsequently test for the hypothesis that Chinese OFDI, along with the Chinese entrepreneurial institutional environment and inward FDI, impacted entrepreneurial activities from the year of 2004 to 2015. We find that OFDI has an inverted “U” effect on entrepreneurial activities, and that the impacts of inward FDI as well as the foreign trade are different in the coastal and non-coastal cities. We conclude by discussing the implications of our findings for researchers and policymakers as well as the limitations of our data.
Highlights
As the Chinese strategy for international expansion is developing, China’s outward foreign direct investment (OFDI) increased dramatically with Chinese enterprises’ growth
Studies on aspects of OFDI from transition economies within the international business literature are incomplete without consideration of its impact on home countries’ entrepreneurship, which has been shown to play a critical role in fostering economic growth, technology transfer, new market development, and enterprise restructuring [23]
We find that Chinese OFDI distinctively and differently influences domestic entrepreneurship with the developing Chinese economy, especially before the year of 2008 in the coastal areas
Summary
As the Chinese strategy for international expansion is developing, China’s outward foreign direct investment (OFDI) increased dramatically with Chinese enterprises’ growth. Since knowledge and technology along with economic development contribute to innovation, and since innovation implies entrepreneurial activity [13], we believe China’s OFDI has an influence on Chinese entrepreneurship. Studies on aspects of OFDI from transition economies within the international business literature are incomplete without consideration of its impact on home countries’ entrepreneurship, which has been shown to play a critical role in fostering economic growth, technology transfer, new market development, and enterprise restructuring [23]. Our study extends the international business literature by first examining the relationship between OFDI and total entrepreneurial activities in the home country and focuses on answering two research questions within the context of the Chinese economy:. We comment on limitations of our work and potential for future research
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Free) 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
