Research On The Influence Of Financial Development On The Location Choice Of OFDI Enterprises In China

With the acceleration of China's opening up to the outside world,Chinese enterprises have also joined the wave of globalization.The proposal of "One Belt And One Road" in 2013 accelerated the process of OFDI of Chinese enterprises,and investment facilitation was further implemented.However,to continue to expand the development space of China's OFDI,it is necessary to have sufficient financial support.China's financial market started late,the degree of interest rate liberalization is low,and the insufficient development of domestic finance leads to the insufficient capital supply required by enterprises to carry out OFDI activities,which has become one of the bottlenecks restricting the development of Chinese enterprises.It has become an important issue whether the host country's financial market can be effectively used to obtain funds required by OFDI,and how the development level of finance in the host country affects OFDI of enterprises of different types and motivations in China.Based on the existing research,this paper attempts to measure the impact of host country's financial development on China's OFDI from the quantity and quality dimensions.Due to the different financial development levels of host countries,this paper divides the sample countries into developing countries and developed countries.Theoretically,the influence mechanism and path of these two kinds of national quantity and quality dimensions financial development on OFDI location selection of Chinese enterprises are analyzed respectively,and the status quo of host country's financial development and China's OFDI is also analyzed.On the basis of the above analysis,the cross-national panel data of 59 countries or regions from 2005 to 2017 were used for regression analysis.The results show that: firstly,the financial development of the host country is one of the factors that constitute OFDI location selection of Chinese enterprises.The development of quantity dimension finance has a significant positive effect on OFDI of China's enterprises,and the quality dimension of financial development varies with the host country's level of development.The differences are as follows: the quality dimension financial development of the host country in developing countries has no significant influence on the OFDI behavior of China's enterprises;the quality dimension financial development of developed host country has a significant positive effect on OFDI of China's enterprises.Second,the location advantage of the host country is an important factor for OFDI of Chinese enterprises.Chinese enterprises' direct investment in developing host countries has obvious market-seeking motive and technology-seeking motive.Direct investment in developed host countries has significant technology-seeking incentives.Finally,according to the conclusions of the study,this paper puts forward some targeted policy suggestions.This paper innovates in the following aspects: firstly,since few existing literatures have studied the influence of the financial development level of host country on the OFDI location selection of home country,this paper aims to study the influence of the financial development of host country on China's OFDI location selection from a new perspective.Secondly,most of the existing researches measure financial development with a single index.This paper enriches the financial development index and synthesizes the comprehensive index to measure financial development with the coefficient weight method,which improves the one-sidedness of a single index.Finally,this paper constructs the quantity and quality dimension financial development indicators,and based on the quantity dimension and quality dimension financial development,systematically studies the influence of the host country's financial development on the OFDI behavior of Chinese enterprises,detailing the research in this field.