Does Ethnicity Pay? Evidence from Overseas Chinese FDI in China
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Huang-2013-DOES ETHNICITY PAY_.pdf
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Author(s)
Huang, Yasheng
Jin, Li
Qian, Yi
Date Issued
July 2013
Journal
Review of Economics and Statistics
Publisher
MIT Press
Citation
Huang, Yasheng, Li Jin, and Yi Qian. “Does Ethnicity Pay? Evidence from Overseas Chinese FDI in China.” Review of Economics and Statistics 95, no. 3 (July 2013): 868-883. © 2013 The MIT Press
Version
Final published version
Abstract
Most of the economic analyses of the overseas Chinese network focus on trade and investment flows at the country level. In this paper, we analyze the effects of the ethnic Chinese network at the firm level. Contrary to the conventional wisdom, we find that ethnic Chinese FDI firms in China in fact underperform nonethnic Chinese FDI firms. We also find that the performance of ethnic Chinese firms deteriorates over time. We present evidence consistent with the hypothesis that ethnic Chinese firms underinvest in those firm attributes that may contribute to long-term performance, such as human capital and technology. Our findings raise both empirical and normative implications of ethnic ties.
MIT Department
Sloan School of Management
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Article is made available in accordance with the publisher's policy and may be subject to US copyright law. Please refer to the publisher's site for terms of use.
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DOI of Published Version
https://doi.org/10.1162/REST_a_00281
