Date of Award

12-2024

Access Control

Open Access

Degree Name

Applied Economics, M.A.

Department

Economics and Finance

Advisor

Xingwang Qian

Department Home page

https://suny.buffalostate.edu/programs/applied-economics

First Reader

Xingwang Qian

Second Reader

Joelle LeClaire

Third Reader

Theodore Byrley

Abstract

This study aims to conduct a comparative analysis of outward foreign direct investment (OFDI) from China and the United States into the United Kingdom, with the intention of uncovering the distinct motivations behind their investment behaviors under different political-economic systems. Given the unique political and cultural backgrounds of China and the US, their approaches to OFDI exhibit varied characteristics in the international market. The United Kingdom, a main investment destination for both China and the US, is selected to reflect the distinctive features of Chinese and US’s OFDI.

The research focuses on how the determinants such as market growth, natural resources, strategic assets, international exchange, inflation, and openness to OFDI influence the investment decision of Chinese and US’s OFDI. Theoretical frameworks like the Eclectic Paradigm (OLI framework), Institutional Theory, and the Resource-based View are used to explain these impacts. Through empirical analysis, the study seeks to identify which factors significantly affect the OFDI decisions of China and the US in the UK and examines how these factors interact in complex ways to influence investment flows.

The research found out that US’s ODI is more positively linked with UK’s market growth (GDP), the openness to OFDI, and the export to the UK, while China’s ODI appears to be more impacted with resource-related variables, and exchange. Both China and US ODI are significantly impacted by the inflation. We do not find substantial evidence that the technology and innovation of the UK is either country’s driving factor for the investment.

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