Study On The Location Selection Of Chinese Firms OFDI In "Belt And Road" Countries

The paper is based on the location selection theory,international investment theory and new trade theory.In order to study the influence of enterprise heterogeneity factors and host country factors on the location selection of Chinese firms OFDI in “Belt and Road” countries,we match the “Industrial Enterprise Database” and “List of Overseas Investment Enterprises(Institutions)” from 2003 to 2013 respectively getting 1394 sample data and 50128 observations.Then,we use conditional logistic regression model to conduct empirical test.First,from the aspect of heterogeneity factor of the enterprise,the conclusions can be drawn: The heterogeneity factor of firms has no significant influence on the location selection of Chinese firms OFDI in “Belt and Road” countries.The greater productivity of the enterprise,the more countries it could conduct OFDI along the “Belt and Road”.Second,from the aspect of host country factor,through the overall sample data,we could find that: The more stable politics,the smaller cultural distance,and the better economic system,firms are more tend to establish branches in this country.The larger market size,the greater market potential;the richer natural resources;the lower entry cost,the enterprise is more inclined to OFDI in the country.But Chinese firms do not have the incentive to seek efficiency and strategic resources in the “Belt and Road” countries.At the same time,firms tend to invest in the countries with close distance and poor infrastructure.Through the subsample of state-owned firms and private firms,the conclusions can be drawn as follows.For institutional factors: Private firms have stronger motives to avoid political risks.State-owned firms are more inclined to enter the countries with less cultural differences.Stateowned firms are not sensitive to the economic environment but private firms are inclined to invest in a country with good business environment.For economic factors: Private firms have more motive to seek market and pursue short-term goals and state-owned firms have market-seeking motive of long-term goals.Private firms have strong incentives for seeking efficiency but state-owned firms don't.Private firms have strategic resources seeking motive,but state-owned firms don't.State-owned firms are more motivated to seek natural resources.State-owned firms tend to invest in countries with poor infrastructure.Private firms are more inclined to invest in countries with geographical proximity.Through the subsample of different industry characteristics,here are the results: Laborintensive firms do not have the incentive to seek low-cost labor,tend to invest in low-cost entry countries.Resource-intensive firms have strong incentives to seek resources.Technology-intensive firms do not have the incentive to seek strategic resource.Capital-intensive firms have the dual motive to seek resources and seek efficiency.Labor-intensive,technology-intensive,and capitalintensive firms are all motivated to seek efficiency,and intensity is arranged from large to small.This paper tries to put forward some suggestions like these:(1)If the companies want to increase the number of location selection of OFDI in“Belt and Road”countries,companies should strive to increase productivity levels.(2)For private enterprises,it is necessary to choose a host country with low political risk and good economic environment;also the host country should have low labor cost,high technology level,large market scale and close geographic distance.For stateowned enterprises,the countries with small cultural differences,large market size and market potential,and abundant natural resources should be selected.(3)Labor-intensive enterprises should choose to invest in low-cost entry,large-scale host countries;resource-intensive enterprises should choose resource-rich host countries to invest;technology-intensive enterprises should choose largescale host countries to invest;capital-intensive enterprises should Choose a host country with abundant resources and a large market to invest.