This paper presents a study of which affect determining factors of foreign direct investment (FDI) has had in China’s eastern provinces. The eastern region is studies to shed more light on why these provinces has been able to attract more FDI than the central and western provinces. FDI theory gives an explanation to why business make direct investments on foreign markets and what factors that affect these decisions. Four of these factors; wage, education level, GDP per capita and level of infrastructure are studied using data from China Statistical Yearbooks. Data is studied by using an index created by the author. The results indicate that education level is of importance when wage levels increase in order to keep attracting FDI. Also, a positive relationship between infrastructure and FDI inflow is found.

Beslut om och var man ska genomföra en direktinvestering grundar sig på en rad faktorer. En av dessa är den risk som är förknippad med investeringen. Den här uppsatsen tar upp risk i form av volatilitet dels på aktiemarknader men också för växelkurser. Med utgångspunkt från två teorier där den ena säger att hög risk är förenat med en lägre nivå av direktinvesteringar samt en motsatt som istället menar att hög risk leder till en högre direktinvesteringsnivå undersöker jag situationen för USA och Sverige. Genom att undersöka just dessa länders marknader får man en bild av ekonomins storleks betydelse för huruvida risken påverkar direktinvesteringar eller inte. Resultatet tyder på att risk i form av aktiemarknads- samt växelkursrisk inte påverkar andelen direktinvesteringar i en liten ekonomi som Sveriges men att det i USA’s fall finns ett positivt samband mellan andelen direktinvesteringar och aktiemarknadsrisk samt ett negativt samband mellan andelen direktinvesteringar och växelkursrisk.

This paper analyses how corruption in a host country affects the amount of Foreign Direct Investment (FDI) it receives. It discusses a model in which FDI is explained by GDP, corruption and the distance between the host country and the origin of capital. It then runs a regression comparing FDI from developed to 46 developing countries, which shows that corruption is a significant variable and it does have a negative effect on total FDI. It then compares if there are any difference depending on the origin of Capital, comparing USA, Europe and Japan. Capital from USA is the most sensitive to corruption. It also shows that capital from Europe is the least responsive to distance, as a factor of explaining FDI. The paper also runs a base mark estimation of what could be expected if corruption levels changed. We can see that if Dominican Republic would have reduced the level of corruption to that of Uruguay, it could have increased the average FDI per year, from 0,8% of GDP to 1,4%. If Argentina, who has a higher FDI over GDP than expected given its level of corruption, would have reduced its level of corruption to the level of Chile, it could have increased the FDI over GDP from 2% to 3,6%. The implications of the results of this paper are that public policies should aim to reduce corruption levels because they have a negative effect on FDI and on the living standard.

This thesis set out to investigate the relationship between political regime type, and FDI inflow. The academic field has seen a fair amount of research in recent years, but this is usually limited to the likes of democracies and autocracies. I argue that many countries are neither of these two, but find themselves in a political unstable gray zone in between, called hybrid regimes. This thesis draws on a comprehensive dataset ranging from 1980-2010, and by way of time-series cross-section analysis; it sets out to explore the attractiveness of hybrid regimes in relation to FDI inflow. The findings indicate that unstable political regimes do attract MNCs, but that they usually are dependent on natural resources. Hybrid regimes receive more FDI inflow than autocracies, but less than democracies. The thesis also find that the region Africa is special in that hybrid regimes are the biggest recipient of FDI inflow, with natural resources being the main factor. The findings support the former literature saying that democratic conditions attracts MNCs, but also question the alleged democratic transition taking place in a growing oil-dependent world.

The purpose:  The purpose of this paper is to identify the determinants Chinese and Russian outward foreign direct investments during the years 2007 and 2008. We also intended to compare them and discuss the similarities and differences between the countries. We purposed three hypotheses, that Chinese and Russian OFDI are market-, strategic asset- and natural resource-seeking.   Design/methodology/approach:  We have employed a regression ordinary least squares model to identify the determinants of Chinese and Russian OFDI. We have used each countries official data that provided us with 80 countries receiving Russian OFDI and 149 countries receiving Chinese. The coefficients showed what kind of coherence there is between the hypotheses and the level of investment in different countries.   Findings: The findings reveal that China´s OFDI are market-seeking but not strategic asset-seeking. The variables measuring natural resource-seeking did not attain any significance for China and none of the variables measuring market-, natural resource- and strategic asset-seeking attained any significance for Russia. Which gives us the impression that according to our results, the general theory cannot entirely explain Chinese and especially not Russian OFDI which is why we call for a special theory for these two countries.     Keywords: Outward foreign direct investment, China, Russia, BRIC,

Russia is a rapidly growing market with enormous potential for international companies. In many industries competition is underdeveloped as Russian local companies are often unable to satisfy constantly growing demand of the market. On the other hand, international enterprises hesitate to enter the market due to its complexity and difficulties like e.g. bureaucracy and corruption. The aim of the present bachelor thesis is to define main challenges of the Russian market with the help of a modified PESTEL model which emphasizes political, economic, social, and legal aspects of the market. Having identified the main market challenges exporting, joint ventures and foreign direct investments as means of market entry are assessed in terms of coping with these challenges. As an outcome of the theoretical section, a model assessing the chosen entry modes is developed together with a list of challenges of the Russian market. The developed theoretical model is applied to a Swedish automotive industry through conduction of semi-structured interviews with key representatives of a number of Swedish enterprises operating in Russia. After the empirical analysis, the theoretical model is reviewed and the main challenges of the Russian market experienced by the interviewees are stated. Moreover, the most common entry modes within the Swedish automotive industry are identified. This thesis will be applicable both for students who would like to learn about different entry modes and ways of analyzing foreign markets through a theoretical framework, and for Swedish companies that aim to enter the Russian market and need to understand its challenges in order to avoid failures in the initial stage and gain ideas about the most suitable entry mode for them.

China has become one of the most attractive destinations for foreign direct investment (FDI) in the world. The Chinese government is still imposing regulations on certain industries in which foreign firms have to establish through a joint venture. Joint ventures with a Chinese partner are considered to be a great risk due to the environment they operate in and also due to cultural aspects and many joint ventures end with a buyout. The aim of this study is to analyze what factors firms need to be aware of when entering into a joint venture and how to avoid or overcome the problems that arise. The essay is written using a qualitative method. The study is partly based on a literature study, partly on primary sources. The primary sources consist of five interviews with representatives from companies who are either currently in a joint venture or have previously been in one. Six interviews with experts within the field have also been carried out.   The essay is strongly influenced by the contingency theory which argues that the performance of a company depends on the environment the company is operating in. The problem has therefore been tackled through describing the specific conditions that a foreign firm will meet in China. Joint ventures with a partner from another country involve risks but can also be of great advantage if they are run in a good way. How to run the joint venture might differ between firms but some factors seem to be common for most firms. It is important to be careful which partner to choose and to do a due diligence in the beginning as well as having a letter of intent written down in the initial stages. Operating in China might bring unusual challenges so it is important for the foreign firm to have knowledge about the Chinese culture and the Chinese laws and regulations before establishing in China.

Abstract This thesis is focus on exploring the effect that domestic manufacturing vendors investing in Mainland China vs. Taiwan domestic employment issue. That the trend of the Taiwan unemployment rate gradually increasing these years is whether not related to the domestic vendors investing in Mainland China is the main topic of what we are discovering from the research. We have been observing the yearly tendency toward investing in other countries and change of the domestic labor demand and supply. According to the labor demand theory and other factors of labor demand affected we simultaneously consider one real model is built. Afterwards, we have divided manufacturing into 15 industries that categorizes labor intensity and capital intensity depended on industry characteristic. Based on the 1991-2202 pooling data calculated by OLS, we proceed to get the real evidential analysis of the domestic labor demand effect by investing in China. The result found: labor intensity of manufacturing who invest in China have outstandingly negative effect on the Taiwan domestic labor demand that means the employment opportunity in Taiwan is dramatically decreasing. The higher the investment percentage is, the lower the domestic labor demand is. Capital intensity of manufacturing, however, have positive effect that is not that outstanding at this moment. Therefore, the reason of unemployment rate yearly increasing in general is the manufacturers¡¦ enthusiastic investing behavior to Mainland China that only happened in labor intensity of manufacturing. Beside the factor of labor manufacture, the domestic economy downside is decreasing labor demand that is one of the reasons for unemployment rate increasing.

None

China had experienced high-speed economic growth rate, and the FDI (Foreign direct investment) had played an important role. China usually adjusted tax rate to attract the FDI and achieve macro-control. After entering WTO, China started to cancel some foreign favorable tax policies to meet the requirement of WTO. Many scholars thus started to discuss the impact of tax reform and whether this tax reform would promote the industry upgrade. From the data of the Ministry of Commerce, we find that FDI from Taiwan had played an important role. It is because the racial relationship, same language, and near skin color could help overcome the barrier entering China market. What’s more important is that China had released many favorable tax policies, which can attract a lot of FDI. In this paper, we introduce the Chinese tax and do the empirical and penal data analysis from the statistic data which mainly focuses on the two tax reforms in 1994 and 2002. After doing this research, we wish we can realize the impact of China’s tax reform on Taiwan’s FDI. Moreover, we expect that this paper can benefit businesses when they are going to invest in China and can be the reference to both Taiwan’s and China’s government when they formulate the policy about the foreign investment.