A Study On Chinese OFDI Location Choice In "One Belt One Road" Countries

In recent years,with the development of new institutional economics,expect the traditional OFDI factors such as market size,trade and investment policy,bilateral exchange rate,and infrastructure,scholars began to introduce institutional quality and institutional distance into OFDI research.On the other hand,with the development of "One Belt One Road" strategy,OFDI scale of China continues to expand,and more and more companies will choose this area to invest.However,there are many differences between the 64 countries and China,such as political,economic and cultural systems,so that the institutional distance has different influences in the process of multinational investment selection.Therefore,it is of great theoretical and practical significance to select the institutional distance as the research perspective and to lock the 64 countries along the " One Belt One Road " to try to clarify the influence mechanism of the system distance on the selection of China's OFDI location in this region.This paper combs the relevant research status and theories at home and abroad,combined with the specific institutional environment of " One Belt One Road ",then analysis the mechanism system on the selection of OFDI location in China.This paper divides the institutional distance into the regulatory and normative system distance,using the cross-country panel data from 2003 to 2015,and chooses four control variables such as market size,economic environment,whether to sign bilateral investment agreements,overseas investment demonstration effect.The extended investment gravitational model is established,and the influence degree of the two institutional distances on the selection of OFDI location is verified by empirical test.The results show that: firstly,Regulatory and normative institutional distance has a negative impact on the location choice of the enterprise,and the enterprise is more inclined to invest in a smaller distance countries.Second,the traditional factors of influence on the choice of behavior of the Chinese enterprises is still important.Finally,based on the complex mechanism of the regulatory system distance,the preliminary regression results can not reflect the pros and cons of the regulatory system environment between China and the 64 countries.So this article distinguish and test to its direction,the result is like this: the impact of the institutional distance is not obvious when the Chinese enterprises choose the state with poor regulatory environment to investment;when choosing a country with better environment,the impact of institutional distance is greater.Therefore,when we choice the first type of host countryto investment,we should pay attention to the assessment of institutional risk;when choice the second type of country,we should pay attention to the advantages and disadvantages of the institutional environment in order to narrow the regulatory system to promote investment.For the reduction of the normative system distance,we should pay attention to the localization of business strategy and non-governmental economic and trade cooperation and exchanges.