Study On Influence Of Political Risks On The Choice Of Multinational Investment Entry Mode

Economic integration has become the trend of the world economy, to integrateinto the process of the world economy globalization in a better way, Chineseenterprises have taken the strategy of "go out". However, due to not familiar withforeign investment environment, Chinese enterprises have to face the political riskform host countries.This paper selects the political risk as the key factor, researches its influence tothe selection of the Multinational corporations investment entry mode in the empiricalway, and adds four factors of host country:economic openness, economic stability,infrastructure, market potential to research their regulationly effects.This paper takes245chinese companies which having488subsidiaries inforigen as samples, to research the factors of investment entry mode, political risk,economic openness, economic stability, market potential, infrastructureof the hosteconomy, enterprise international management experience and the size by usingcorrelation analysis, variance analysis, regression analysis and other quantitativeanalysis methods.The following conclusions are drawn: political risk is bigger, corporationschoose joint venture (holdings or non-Holdings) entry mode; the influence frompolitical ri sk to investment entry mode choice effect can be affected by economicopenness, economic stability, infrastructure, market potential of host country.Finally on the basis of theoretical and empirical research conclusions, this paperwill put forward some suggestions from two levels of government and enterprises forChinese multinational corporations when entering new markets abroad about how tosolve or avoid the influence from political and for others researchers about how toresearch in a better way in the furtune.