Department Chair

Frederick Floss, Ph.D.

Date of Award


Access Control

Campus-Only Access

Degree Name

Applied Economics, M.A.


Economics and Finance Department


Xingwang Qian, Ph.D.

Department Home page

First Reader

Xingwang Qian, Ph.D.

Second Reader

Frederick Floss, Ph.D.

Third Reader

Theodore F. Byrley, Ph.D., CFA


This thesis summarizes and analyzes the theoretical mechanism of the effect of exchange rate on outward foreign direct investment (OFDI) from two aspects of exchange rate level and exchange rate volatility, then analyzes the structure of China's OFDI, and finally makes an empirical analysis of the effect of RMB exchange rate on China's OFDI based on the industry panel data from 2005 to 2017.

The conclusions are as follows: Firstly, the RMB exchange rate level has a negative impact on China's OFDI; Secondly, the RMB exchange rate volatility has a threshold effect on China's OFDI. Specifically, when the stock of OFDI is low, the exchange rate volatility has a promoting effect on OFDI; When the stock of OFDI exceeds a certain level, the volatility of the RMB exchange rate begins to restrain OFDI. Thirdly, although China's OFDI is developing rapidly, it is still not mature. Specifically, the investment destinations are not diversified and are too limited in Asia; there is still lack of a market mechanism for OFDI activities. Among the companies participating in OFDI, the OFDI stock of state-owned companies accounts for 50% of China's total OFDI stock, while the participation of private companies is insufficient.

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