How Does Inward FDI Hinder or Promote Outward FDI? Three Cases of Chinese Automotive Industry

Abstract

In this paper we investigate the mechanisms underlying dynamic linkages between inward FDI and outward internationalization in the Chinese automotive industry. While several studies have examined the relationship between inward and outward FDI using empirical data, this is among the first to employ a case study approach to investigate how international joint ventures (IJVs) established between foreign and Chinese automakers can shape their internationalization motivation, degree, and speed. We discuss some unique features of Chinese carmakers with and without IJVs to elucidate how firms without IJVs will be more driven to expand internationally while firms with IJVs face constraints in venturing abroad.

Keywords

inward and outward FDI / international joint ventures / emerging market multinationals / China / case approach / automotive industry

RIGHTS & PERMISSIONS

2014 Higher Education Press and Brill