Skip to the main content

Economic research - Ekonomska istraživanja, Vol. 32 No. 1, 2019.

Original scientific paper

https://doi.org/10.1080/1331677X.2019.1628652

FDI and labour share of home-country: empirical evidence from micro data of Chinese enterprises

Nisha Jia ; International Business School, Shaanxi Normal University, Xi’an, China
Yonghui Han ; Guangdong Institute for International Strategies (GIIS), Guangdong University of Foreign Studies (GDUFS), Guangzhou, China
Keming Peng ; Guangdong Institute for International Strategies (GIIS), Guangdong University of Foreign Studies (GDUFS), Guangzhou, China
Hongzhen Lei ; International Business School, Shaanxi Normal University, Xi’an, China

Full text: english pdf 1.746 Kb

page 1320-1335

downloads: 471

cite

Abstract

When an enterprise is operating globally, it will surely lead to the flow of production factors, and thus change the factor income distribution in the home country. This paper studies the influence of FDI on the labour share in enterprises’home country under the background of continuous economic globalisation. Based on the theory of Heterogeneity of FDI Motivation, this paper first analyzes the influence mechanism of FDI on home country labour share. Then, with the micro data of Chinese enterprises, this paper adopts Mahalanobis distance matching and Difference-in- Differences (DID) estimation to have empirical test on the influence of FDI on the labour share in enterprises’home country. The results show that, overall, enterprises’ FDI and labour share in the home country present a negative correlation. In terms of hetero- geneity of FDI motivation, market-seeking FDI significantly decreases the labour share in the home country, while resources- seeking and technology-seeking FDI significantly increase the labour share in the home country. From the perspective of host country heterogeneity, FDI in developed countries significantly increases the labour share in the home country, while the FDI in developing countries inhibits the increase of labour share in the home country

Keywords

Foreign direct investment (FDI); labour share; motivation of FDI

Hrčak ID:

228762

URI

https://hrcak.srce.hr/228762

Publication date:

22.1.2019.

Visits: 1.182 *