The Behavioral Research Of Chinese Firms' Outward Foreign Direct Investment In Agriculture

Under the background of economic globalization,the developing economies develop quickly.Outward foreign direct investment increases rapidly,and transnational enterprises increasingly highlight their important role in the world economy.Agriculture is the basis of Chinese national economy,and under the current background of economic globalization,Chinese agriculture not only needs to be established in China,but also needs to actively “Going out”.However,because of the late emergence of Chinese outward foreign direct investment,irregular development of industries,and the increasingly severe grain security situation,it is inevitable for enterprises to “Going out” to utilize overseas agricultural resources.In 2007,the central number one file put forward to speed up the implementation of agriculture “Going out” strategy.It emphasizes the importance of agriculture “Going out” in the document year by year,namely,fully developing Chinese outward foreign direct investment in agriculture.Therefore,the in-depth research in our country enterprises' behavior of outward foreign direct investment in agriculture has an important significance in theoretically guiding the enterprises' practice.The investment scale influence factors of enterprise,and the entry mode selection and location selection of enterprise outward foreign direct investmentare always the hot issues which are jointly concerned by scholars.A lot of empirical studies show that enterprise's outward foreign direct investment behavior is influenced by many factors.Starting from the phenomenon of Chinese enterprises' outward foreign direct investment in agriculture,taking the entry mode selection,location selection and enterprise scale determination factor of enterprises' outward foreign direct investment in agriculture as core issues,taking international production eclectic theory as main theoretical basis,this paper builds an analytic framework of Chinese enterprises' outward foreign direct investment in agriculture.Taking nationwide enterprises' outward foreign direct investment in agriculture information as data foundation,this paper analyzes the influence factors of scale determination factor,entry mode selection and location selection of transnational agribusiness by applying empirical analysis method and multivariate logistic regression analysis method.Based on this,this paper puts forward the countermeasure and suggestion of promoting Chinese agriculture's “Going out”.The core contents of this paper include three subsidiary researches,and it respectively researches the following three questions:(1)How to select the investment location of enterprises' outward foreign direct investment in agriculture?(2)How to select the entry mode of enterprises' outward foreign direct investment in agriculture?(3)How to determine the investment scale of enterprises' outward foreign direct investment in agriculture? What are the influence factors?The main research contents and research methods of this paper:The subsidiary research one analyzes the location selection of Chinese enterprises' outward foreign direct investment.This research explains location selection issue by utilizing gravity model,researches the influence of the host country's foreign direct investment stock,GDP shares of total value of agricultural output,government governance level,and geographical distance to the location selection of Chinese enterprises' outward foreign direct investment in agriculture by adopting multivariate logistic regression method.The subsidiary research two researches the entry mode of Chinese enterprises' outward foreign direct investment in agriculture.Firstly,this research analyzes the entry mode of transnational agribusiness one by one,and carries on comparative analysis to each entry mode.Secondly,through the empirical research method,it respectively carries on cross analysis between enterprises' outward foreign direct investment in agriculture and investor type,investment location,investment industry.Lastly,it concludes the strategy selection of the entry mode of enterprises' outward foreign direct investment in agriculture.The subsidiary research three analyzes the scale influence factors of Chinese enterprises' outward foreign direct investment in agriculture.The research selects the variable according to principles of vague generalization,gaugeable,real and available data,and investigates the host country's market scale,Chinese influence to the host country's export situation,exchange rate,and the influence of the host country's wage level to Chinese enterprises' outward foreign direct investment in agriculture scale.Through the research of this paper the results can be summarized as following:(1)The host country's foreign direct investment stock,total value of agricultural output accounting for the share of GDP,government governance level,and geographical distance are the main influence factors to the location selection of Chinese enterprises' outward foreign direct investment in agriculture.Its effect relationships are as follows: the more the host country's foreign direct investment stock is,the more the Chinese enterprises carrying out outward foreign direct investment in agriculture will be.The higher the host country's total value of agricultural output accounting for the share of GDP is,the more the Chinese enterprises carrying out outward foreign direct investment in agriculture will be.The higher the government governance level of the host country is,the more the Chinese enterprises carrying out outward foreign direct investment in agriculture will be.The closer the geographical distance between the host country and home country is,the more the Chinese enterprises carrying out outward foreign direct investment in agriculture will be.(2)Different investor types possess different ownership advantages.The bigger the enterprises scale and the richer the multinational experience are,the bigger the possibility of wholly owned new subsidiary will be.Different entry modes between investment locations possess significant difference.Developing countries and underdeveloped countries shall adopt the entry mode of joint venture new subsidiary.Developed countries shall adopt the entry mode of wholly owned new subsidiary and mergers and acquisitions.Adopting the mode of joint venture new enterprises is beneficial for enterprises entering in the host country market which is suitable for natural resources development for the first time.Most of the enterprises which invest in farm and sideline food processing industry and animal husbandry shall adopt the way of wholly owned new subsidiary to protect their own special production secret,traditional production process,and other related technical knowledge property rights.(3)The host country's market scale,export situation,exchange rate to U.S.Dollar and its national income per capital are the important factors influencing Chinese enterprises' outward foreign direct investment in agriculture.Its influence relationship is that the larger the market scale of the host country is,the larger scale of the Chinese enterprises' outward foreign direct investment in agriculture to the host country will be.The bigger the export volume of China to the host country is,the larger scale of the Chinese enterprises' outward foreign direct investment in agriculture to the host country will be.The lower the host country's currency to the value of RMB is,the larger the scale of the Chinese outward foreign direct investment in agriculture to the host country will be.The lower the host country's wage level is,the larger the scale of the Chinese outward foreign direct investment in agriculture to the host country will be.According to the main research contents and conclusions several innovations can be summarized as fllowings:(1)It has a certain innovation on the research framework.Starting from the study of the determinants of outward foreign direct investment.Taking monopolistic advantage theory,internalization theory,location selection theory,the eclectic theory of international production and game theory as main theoretical basis.Then combined with the existing research literature on the outward foreign direct investment and the development of China's foreign direct investment in agriculture.This paper builds an analytic framework of Chinese enterprises' outward foreign direct investment in agriculture.From the view of existing research,the literature about Chinese enterprises' outward foreign direct investment in agriculture is few.The research framework of this paper will make up and expand the research.In addition,starting from the research framework,explains the problem of outward foreign direct investment in agriculture from the collection analysis to the information data of enterprises' outward foreign direct investment in agriculture.It will be more effective to explain the core issue of agricultural “Going out” in China.(2)It possesses a certain innovation on the research idea.Generally,the existing researches discussing the enterprises' outward foreign direct investment decision which is under various factors direct influence.The common researches usually take enterprises' outward foreign direct investment flow or stock as explained variable to represent enterprises' outward foreign direct investment decision,however,enterprises' outward foreign direct investment flow or stock is only the expression of the investment scale,while the investment process also includes entry mode selection and location selection,etc..Each influence factor has totally different influence effect to enterprises' investment scale,entry mode and location selection,and only identify their influence relationship,can it really explain the enterprises' outward foreign direct investment decision.This paper puts forward to explain Chinese enterprises' outward foreign direct investment in agriculture decision behavior from three aspects of enterprises' investment scale,entry mode and location selection,and makes an in-depth analysis about these three aspects' different influence factors.(3)It possesses a certain innovation on the research variable selection.It is different from the existing researches using export volume as one of the determinants of outward foreign direct investment,This article uses the amount of goods exported to the total amount of import and export as a proxy variable for bilateral trade relations,The empirical results show that this variable has a more significant impact on the scale of foreign direct investment in Chinese enterprises.Differing from the existing researches explaining the selection of investment location from the perspective of outward foreign direct investment fund flow,this paper explains the issue of the location selection of enterprises outward foreign direct investment in agriculture from the target market's existing transnational agribusiness number,in order to more fully explain the phenomenon of enterprises' location selection.The eclectic theory of international production indicates that the location advantage means enterprises arranging production activities in the geographic area which is most beneficial for playing ownership advantage by utilizing the host country's system and production factors.Location advantage does not only determine the success of enterprises carrying on outward foreign direct investment,but also determine the location selection of enterprises' outward foreign direct investment.This paper's research is exactly the empirical analysis to classical theory assumes.In addition,the research method of this paper using gravity model to explain location selection also possesses a certain innovation.