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Heterogeneity Manufacturers International Market Entry Mode Selection And Policy Support Research

Posted on:2011-01-28Degree:DoctorType:Dissertation
Country:ChinaCandidate:C ChenFull Text:PDF
GTID:1119360305957968Subject:World economy
Abstract/Summary:PDF Full Text Request
Export-oriented economy is a notable feature of economic development of countries today. For one firm, international production and operation can both expand the size of the market and reduce production costs. For one country, the development of export-oriented economy is able to promote economic growth effectively. Firms are the main participators in market economic and the government is the manager of the market economic. From the perspective of producers, in the process of internationalization a fundamental question is what mode of market access can bring maximum profit for firms when accessing international markets. From the perspective of the manager, one question for him is what kind of policies made by government can help firms to gain more profit, which can also benefit the country. Firms and the government are closely linked in the process of development export-oriented economy.The development of export-oriented economy and implementation of the strategy of going out are two basic strategies of China's economic growth. The great achievements prove the correctness and importance of the two strategies in the past three decades of reform and opening up. However, during the process of the implementation of the strategies we also encountered some problems. China's export growth has been severely affected by the financial crisis happened in the last two years. Thus, we need to reflect on the behavior of firms and the government. How do firms choose their mode of market access? How does the government make effective policies for firms? The two issues are the main topics that we are going to analyze in this paper.Based on heterogeneous firms trade and investment theory, this paper reveals the relationship between firms'characteristics and their mode of market access, analyze the effects of trade policies and FDI policies as well as using China firms'data to test the theory conclusions. Starting from literature review, we induce the main research content of heterogeneous firm trade theory (Chapter 2) and choose the heterogeneous firms'choice of mode of market access as the object of this paper, this problem belongs to the scope of firm decision-making. On this basis, we put the government trade policy and FDI policy into the framework of heterogeneous firm trade theory, this problem belongs to the scope of government decision-making. On the problem of firm decision-making, we do first theoretical analysis' (Chapter 3), to explore how the heterogeneous firm choose production patterns between export, horizontal FDI and vertical FDI, after that we use the data of China to test the conclusions of theory (Chapter 6). In government decision-making research, we also do first theoretical analysis (Chapter 4 and Chapter 5), followed by empirical test using Chinese data (Chapter 7 and Chapter 8). Finally, we summarize the conclusions of each chapter to get general conclusions of the full text (Chapter 9).The main conclusions of this paper are as followed. For firms they should select an appropriate mode of market access according to their level of productivity. First, a firm must figure out its level of productivity in all firms in the industry. If its productivity is at the upstream level, it can choose to invest abroad; if at the middle level, it can choose to export; if at the downstream level, it is only suitable for domestic production and sales. Secondly, it is necessary for a firm to improve its own productivity level if it wants to change the existing mode of market access and engage in a more sophisticated one.For the government, First, the government needs to encourage and help firms to improve productivity, which requires the government to establish innovation fund, to increase R & D investment, to increase firm R & D subsidies, to establish a national innovation system, to encourage and support firms in technological innovation, to serve and meet all the needs related to technological innovation and so on. Secondly, the government should work hard to help businesses reduce the cost of accessing the host country, which includes establishing a good economic and trade cooperation relationship with various countries and regions and providing full range of services and training for those firms who want to "going out". Thirdly, the use of government subsidies policy should combine with the characteristics of the firm heterogeneity. Subsidies resources should be mainly allocated to the profit-making firms, capital-intensive firms, and firms in central and western regions of China.
Keywords/Search Tags:Heterogeneous firm, Mode of market access, Trade policy, FDI policy
PDF Full Text Request
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