TITLE:
Does OFDI Promote High-Quality Development of Enterprises? Evidence from China
AUTHORS:
Cheng Peng, Xinyuan Jia, Ying Tang
KEYWORDS:
OFDI, High-Quality Development, Technological Innovation, Total Factor Productivity
JOURNAL NAME:
American Journal of Industrial and Business Management,
Vol.12 No.2,
February
25,
2022
ABSTRACT: Whether
foreign direct investment can promote enterprise productivity and high-quality
development has not yet reached a consensus in academic circles. By using the
samples of A-share listed companies in China from 2008-2019, this paper adopts
Propensity Score Matching (PSM)—Multi-temporal Difference-in-Differences (DID)
to examine empirically whether corporate OFDI contributes to the high-quality
development of enterprises from the perspective of total factor productivity.
The study finds that OFDI significantly improves the total factor productivity
of enterprises. It has more effect on state-owned enterprises than on private
enterprises, and more effect on enterprises in western regions than on those in
eastern and central regions. However, the promotion effect is not present in
non-central policy-supported manufacturing enterprises. Technological
innovation, exploratory innovation, and exploitative innovation mediate the
relationship between OFDI and enterprise high-quality development. This paper
provides empirical evidence for how to better promote enterprise innovation
strategy and high-quality development under the “dual circulation” development pattern.