Research On Influences Of The Location Dispersion Of OFDI On Firm Performance In Information Technology Industry

The influence of OFDI on the performance of enterprises in developing countries has attracted the attention of many scholars.Among them,the research on the influence of the location distribution of OFDI on firm performance has not yet reached a consensus conclusion,and the analysis of the impact mechanism is not deep enough.Based on the micro-data of China’s A-share listed information technology enterprises in 2013-2017,this paper uses the entropy index to establish an index that can measure the concentration or dispersion of the geographical distribution of OFDI in the enterprise—OFDI location dispersion,and combines relevant research on the OFDI location,the mechanism of the impact of location dispersion of OFDI on firm performance is analyzed in depth.On this basis,the causal relationship between the location dispersion of OFDI in information technology enterprises and firm performance is empirically analyzed.The empirical test finds that the location dispersion of OFDI in information technology enterprises is negatively correlated with firm performance.At this stage,the concentrated cross-border investment of China’s listed information technology industry is more conducive to improving the business performance of multinational enterprises than diversified investment.The reason is that at the current stage,China’s information technology enterprises are in the early stage of OFDI,the multi-regional operating capacity is weak,and the experience of foreign investment is relatively lacking.The enterprises do not have the ability to use location advantages in many different regions,resulting in the advantages of the decentralization of the OFDI location and diversification of region are offset by the lack of management experience and professional knowledge.Furthermore,coupled with the current "blindness" of domestic enterprises’ overseas investment,they often deviate from the optimal level of OFDI location dispersion.Therefore,from the comprehensive analysis of factors such as transaction cost scale effect,risk dispersion,learning effect and resource acquisition,the comprehensive impact is negative.According to the research conclusions,we propose to China’s information technology enterprises to invest in foreign direct investment:they should be extremely cautious in the process of international geographic expansion.At this stage,we should try to avoid excessively dispersed expansion.When the OFDl experience is rich enough,then they can gradually expand.