This study examines the factors that affect the choice of location for foreign direct investment (FDI) in China. We identify three groups of factors that may affect the location choice by foreign firms: agglomeration economies, infrastructure, and institutional changes resulting from the economic reform. The study utilizes the most recent data from China's industrial census for the empirical testing. The findings show that agglomeration economies, in particular the clustering of foreign firms and domestic firms, exert the strongest effect on FDI location. Higher FDI concentration tends to attract more foreign firms. The clustering of domestic firms exerts a negative effect on FDI locations. Better infrastructure (electricity, telecommunications, and road) and greater institutional change (open policies, privatization, and legal development) also show positive effects on FDI location. The size of the local economy does not seem to affect the choice of location of FDI.
The economic and market reforms in China have given rise to firms with three distinct types of ownership: state-owned enterprises, private domestic enterprises, and foreign-invested firms. The three studies reported in this paper addressed the questions of whether organizational culture varies among firms with different ownership structures and whether it relates to firm performance or employee attitudes as it has been observed in US firms. The first study employed an inductive approach to identify culture dimensions and found five common dimensions across these different types of firms. In the second study, we derived an empirical taxonomy of four organizational culture types involving different configurations of the five organizational culture dimensions, and found a systematic relationship between these culture types and a measure of perceived firm performance. The third study confirmed the relationship between organizational culture types and middle manager attitudes. Suggestions are offered for future research building on the organizational culture dimensions and culture types introduced in these studies.
organizational culture configuration
organizational culture type