TITLE:
FDI in Services and Manufacturing Efficiencies in Host Countries: Evidence from China
AUTHORS:
Libin Luo
KEYWORDS:
FDI in Services; Manufacturing Efficiencies in Host Countries; Inter-industry Technical Spillover
JOURNAL NAME:
iBusiness,
Vol.5 No.3B,
November
8,
2013
ABSTRACT: The paper studies the correlations
between FDI in services and manufacturing efficiencies in host countries. First
a theoretical analysis is presented on the direct and indirect channels through
which FDI in services enhances manufacturing efficiencies in host countries.
Then the forward linkages and backward linkages between FDI in services and
manufacturing sector in host countries are tested empirically using China’s
industrial panel data. We find that FDI in services has positive forward and backward linkage
effects on China’s
manufacturing sector, with forward linkages stronger than backward linkages,
and the wholesale, retail, trade and restaurant sector has the strongest
linkage effects.