Trade Costs and Location of Foreign Firms in China

 
Author/Editor: Javorcik, Beata K. Smarzynska ; Amiti, Mary
 
Publication Date: March 01, 2005
 
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Disclaimer: This Working Paper should not be reported as representing the views of the IMF. The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate
 
Summary: This study examines the determinants of entry into by foreign firms, using information on 515 Chinese industries at the provincial level during 1998-2001. The analysis, rooted in the new economic geography, focuses on market and supplier access within and outside the province of entry, as well as production and trade costs. The results indicate that market and supplier access are the most important factors affecting foreign entry. Access to markets and suppliers in the province of entry matters more than access to the rest of China, which is consistent with market fragmentation due to underdeveloped transport infrastructure and informal trade barriers.
 
Series: Working Paper No. 05/55
Subject(s): Trade | China | Foreign investment | Emerging Markets | Supply | Economic models | China, People's Republic of

Author's Keyword(s): Foreign direct investment | trade costs | market access | supply access
 
English
Publication Date: March 01, 2005
ISBN/ISSN: 1934-7073 Format: Paper
Stock No: WPIEA2005055 Pages: 25
Price:
US$15.00 (Academic Rate:
US$15.00 )
 
 
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