Institutional Impact of Foreign Direct Investment in China

China’s success in attracting high levels of foreign direct investment (FDI) has drawn a lot of attention from around the world, and so has the fast growth of Chinese regions that have enjoyed the lion’s share of the FDI inflow. The specific mechanisms through which FDI has benefited the country’s economic development, however, are less clear than the spectacular growth in both the capital flow and the economy.

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