A Study On The Relationship Between Internationalization And Performance Of Chinese Enterprises

In recent years,with the rapid development of science and information technology,a lot of multinational corporations emerged.Economic globalization will inevitably become the trend of economic development.The drastic changes in the layout of the global economy have made China and other emerging economies become the major forces in motivating the rapid growth of direct foreign investments.This article uses Chinese foreign direct investment in the genuine business world as background, exploring the following two questions:First,in the Chinese context,what effects will the degree of internationalization have on corporate performance?Second,when institutional distances and ownership differ,will there be any difference between the relationship of DOI and performance?In order to answer the above questions,this study applies the listing corporation sample of manufacturing enterprises from 2007 to 2012 and uses Heckman’s two step selection model to investigates the relationship between the internationalization of China’s listed companies and performance.This article measures the degree of internationalization by the breadth and depth respectively.After effectively controlling variables such as the age of these companies,the scale of enterprises and the capital structure,the study draws following conclusions:(1)The degree of internationalization has a significant impact on the performance.In a narrower sense,breadth of internationalization has a significant impact on the performance,and the depth of internationalization has a significant impact on the performance as well.(2)Institutional distance doesn’t have a significant moderating effect.With the increase of institutional distance,the influence which DOI have on performance is not weaken.(3)The breadth and depth of internationalization have more significant effects on performance in private enterprises than in state-owned enterprises.The breadth and depth of internationalization have significant impacts on performance in private enterprises,but not in state-owned enterprises.Finally,the results of this study were discussed and the causes of these results were explained.And according to the empirical results,this paper puts forward some inspiration of management practice,and also points out the limitations of this study.Besides,directions for future research were proposed.