중국내 지역별 부패와 제도발전 수준이 다국적 기업의 해외직접투자에 미치는 영향

The Effect of Corruption and Institutional Development Level on Multinational Enterprises’ Foreign Direct Investment in China

Purpose - This study aims to investigate 1) a direct effect of corruption on foreign direct investment (FDI), 2) an impact of institutional development level on FDI, and 3) an interaction effect of corruption and the institutional development level on FDI at a provincial level. Design/Methodology/Approach - The corruption level, institutional development level, and FDI of MNEs are the main variables for this study. FDI is measured in three dimensions, which are FDI cases, FDI amounts, and capital amounts. We analyzed the 540 corruption index data from 31 provinces and cities in China between 2008 and 2016. Pooled OLS regression was used to test the relationships among the variables. Findings - Results showed that the corruption level negatively impacted the FDI, and the institutional development level positively influenced FDI. The interaction effect of the corruption and the institutional development level on FDI was significant. It is evidenced the higher the institutional development level, the weaker the impact of the corruption on the FDI. Research Implications - This study’s findings supported the previous literature that corruption is harmful to FDI in developing countries, such as China. The results also provide political insight to developing countries by suggesting the importance of policing corruption for economic development.