Study On The Relationship Among The Degree Of Internationalization, The Degree Of Foreign Participation And Performance

This paper studies on the relationship between the degree of internationalization of China’smanufacturing enterprises and performance in the perspective of the degree of foreignparticipation. Based on the Cobb-Douglas model, the theoretical analysis concludes that thedegree of foreign participation has a direct effect on promoting the degree of internationalizationof manufacturing enterprises and plays an indirect role in promoting performance by influencingthe degree of internationalization of manufacturing enterprises. The theoretical model comes tothe transmission mechanism of the degree of internationalization to performance ofmanufacturing enterprises in the perspective of the degree of foreign participation, by studyingthe impacts of the degree of internationalization and the degree of foreign participation on thevarious factors of production and the output elasticity of manufacturing enterprises. On the basisof the theoretical analysis, the empirical model creatively quantifies the performance from thethree dimensions of the short-term profitability, and long-term growth and enterprise value. Theempirical model also has the empirical verification on the three forms of theories of therelationships between the degree of internationalization and performance, and the results showthat the U-shape theory better fits the relationship between the degree of internationalization andperformance of China’s manufacturing enterprises. The in-depth analysis of empirical resultsalso indicate that introducing foreign participation by manufacturing enterprises on the one handdirectly contributes to improving performance, and on the other hand indirectly promotes theupgrading of performance by affecting the degree of internationalization, what’s more, itsindirect promoting role is significantly higher than its direct promoting role, at the same time,governments’ support plays a role in promoting China’s manufacturing enterprises in the processof internationalization. The empirical model also recognizes the role of technical factors inpromoting performance. Finally, this paper proposes policy recommendations from the threeaspects of the moderate introduction of foreign participation and drawing international ideas andpractical experience of foreign participation, enhancing technological innovation and brandbuilding and getting governments’ support.