Determinants of FDI Localization in China

Li, Su, Antonio Angelino, Haitao Yin, and Francesca Spigarelli
Publication Date: 
August 1st, 2017

China has been attracting huge amounts of inward foreign direct investment (FDI). However, it exhibits large dissimilarities in terms of FDI localization across territories that warrant further investigation. In this study, the authors explore the determinants of inward FDIs patterns in China at the county level. They focus on the pharmaceutical industry and assess how and to what extent factors such as location advantages, agglomeration dynamics, and information cost effects and environmental regulation affect foreign firms’ localization choices and the amounts invested in these locations. This analysis confirms the importance of location advantages in shaping pharmaceutical FDI patterns in China.

This piece originally appeared as: Li, Su, Antonio Angelino, Haitao Yin, and Francesca Spigarelli. “Determinants of FDI Localization in China: A County-Level Analysis for the Pharmaceutical Industry.” International Journal of Environmental Research and Public Health, Vol. 14, No. 9 (2017), pp. 1-20. A copy of the article is available here: