| ID | 101159 |
| Title Proper | nvestigation of the China effect on crowding out of Japanese FDI |
| Other Title Information | an industry-level analysis (1990-2004)star, open |
| Language | ENG |
| Author | Salike, Nimesh |
| Publication | 2010. |
| Summary / Abstract (Note) | This paper applies a dynamic panel model to investigate whether China is crowding out Japanese foreign direct investment (FDI) from other economies of Asia. We examined this with industry-level data on Japanese FDI flows into Asian economies. In order to deal with possible problems of serial correlation and endogeneity, we estimated coefficients using a difference and system generalized method of moments to examine the "China effect" on industries. We found a significantly high degree of crowding out effect by China on its Asian counterparts. Among twelve industries, a crowding out effect was found in nine industries, including electrical & electronics-the biggest industry for Japanese FDI. However, a complementary effect was found in two industries, one of them being transport, which is the second biggest industry for Japanese FDI. We conclude that while China's rise is a prominent threat for the region, it could be transformed into an opportunity in vertically fragmented industries. |
| `In' analytical Note | China Economic Review Vol. 21, No. 4; Dec 2010: p582-597 |
| Journal Source | China Economic Review Vol. 21, No. 4; Dec 2010: p582-597 |
| Key Words | China ; Asia ; Foreign Direct Investment ; Crowding Out ; Production Fragmentation |