Title

Quantifying foreign direct investment productivity spillovers in China: A computable general equilibrium model.

Date of this Version

1-1-2013

Document Type

Journal Article

Publication Details

Citation only

Deng, Z., Falvey, R., & Blake, A. (2013). Quantifying foreign direct investment productivity spillovers in China: A computable general equilibrium model. Asian Economic Journal, 27(4), 369-389.

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2013 HERDC submission. FoR code: 140210

© Copyright, The Authors; Asian Economic Journal; East Asian Economic Association and Wiley Publishing Asia Pty Ltd, 2013

ISSN

1351-3958

Abstract

For the purposes of this study, we will construct a static monopolisticallycompetitive computable general equilibrium model to quantify the endogenous productivity spillovers from foreign and domestic firms, using the Chinese economy as a case study. Our simulation results indicate: (i) that the net spillover effects are positive in terms of national total output, GDP and welfare; (ii) that both state-owned and privately-owned firms benefit, but that private firms benefit more; (iii) that industries with large volumes of foreign direct investment (FDI) do not necessarily observe the largest spillover effects; and (iv) that the spillover effects become more prominent when the initial market structure is more concentrated.

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This document has been peer reviewed.