The pitfalls of using foreign direct investment data to measure Chinese multinational enterprise activity

Sutherland, D.; Anderson, J.

Abstract

The growth of Chinese multinational enterprises (MNE) has stimulated great interest in their outward foreign direct investment (FDI) strategies, particularly among academics in business and management studies. To date, however, serious methodological shortcomings plague empirical studies in these disciplines. Specifically, the vital issue of how Chinese MNEs use and route FDI via tax havens and offshore financial centres is not adequately dealt with. These practices have created large geographical, industrial composition and volume biases in Chinese outward FDI data. Using a sample of 100 Chinese MNEs, we illustrate how the use of tax havens and offshore financial centres has created these biases, and examine the implications for understanding Chinese MNE activity.

Citation

Sutherland, D., & Anderson, J. (2015). The pitfalls of using foreign direct investment data to measure Chinese multinational enterprise activity. China Quarterly, 221, 21-48. https://doi.org/10.1017/s0305741014001490

• Journal Article Type: Article
• Online Publication Date: Nov 28, 2014
• Publication Date: Mar 1, 2015
• Deposit Date: Oct 21, 2014
• Publicly Available Date: Dec 2, 2014
• Journal: China Quarterly
• Print ISSN: 0305-7410
• Electronic ISSN: 1468-2648
• Publisher: Cambridge University Press
• Peer Reviewed: Peer Reviewed
• Volume: 221
• Pages: 21-48
• DOI: https://doi.org/10.1017/s0305741014001490
• Keywords: Chinese MNEs, Outward foreign direct investment, Special purpose entities, Tax havens, Offshore financial centres, FDI biases.
• Public URL: https://durham-repository.worktribe.com/output/1419006