Intellectual Property Protection And Foreign Direct Investment Of Chinese Enterprises

With more and more Chinese companies going global,institutional differences between countries are the primary issues facing multinational corporations.The intellectual property system has become a factor that must be taken seriously in the process of enterprise internationalization.Therefore,it is necessary to study the impact of intellectual property protection on the location choice and investment mode choice of Chinese enterprises' overseas direct investment.Based on the current situation of Chinese enterprises' overseas direct investment,this paper explores the impact of intellectual property protection on the location choice of Chinese enterprises' overseas direct investment and the choice of investment entry mode by combing the theoretical mechanism and constructing an empirical model.This paper uses the panel data of 544 Chinese enterprises in 2005-2016 for 123 host countries(regions),and uses the intellectual property protection index compiled by the International Intellectual Property Alliance as a measure of the degree of intellectual property protection,using fixed-effect models and dynamic GMM models.The influence of host country intellectual property protection on OFDI of Chinese enterprises was studied,and the role of investment model selection was further explored by using binary selection model.The study found that the coefficient of intellectual property protection index is significantly negative,which indicates that Chinese enterprises are more inclined to invest in countries with low intellectual property protection.One country that may have low intellectual property protection is more conducive to the imitation and learning of Chinese enterprises;This may be because Chinese companies are more inclined to invest in countries with similar systems to avoid unexpected legal problems.However,combined with the different motives of enterprises,it is found that different enterprises' foreign direct investment motives have different requirements for the degree of intellectual property protection of host countries:enterprises with intellectual assets seeking motives are willing to pay higher costs to protect intellectual assets while seeking knowledge assets.That is to say,when enterprises use intellectual assets as the target of overseas investment,they tend to have high intellectual property rights and intellectual property protection;but enterprises with efficiency-seeking motives are willing to invest in countries with low intellectual property protection while seeking efficiency.For enterprises with natural resource seeking motives,the degree of intellectual property protection of the host country is not the focus of its concern;through further investigation,it is found that enterprises with intellectual assets seeking motives will choose different investment model according to different intellectual property systems in developed and developing countries.In summary,through research,it is found that the intellectual property system factors are more and more important for Chinese enterprises' foreign direct investment decision-making.It is recommended that enterprises should be good at using the positive effects brought about by the differences in intellectual property systems in the process of internationalization,and try to avoid hidden risks,then improve the company's own advantages to promote the long-term development of the company overseas.