Abstract:
Through an empirical analysis, this study examines the relationship between
exports and foreign direct investment (FDI) inflows in China from 1979 to 2021. A
surge in exports and FDI has accompanied China's remarkable economic growth and
integration into the global economy. Understanding the dynamics and interplay
between these two variables is crucial for policymakers and researchers alike. The
study employs a comprehensive dataset from official government statistics,
international databases, and academic research papers. Econometric models,
including regression analysis and panel data techniques, analyze the relationship
between exports and FDI. Control variables such as GDP growth, exchange rates,
and trade policies are incorporated to account for other factors that may influence the
relationship. The findings of the empirical analysis shed light on the nature and
strength of the relationship between exports and FDI in China. As a result of
empirical analysis, a long-term cointegration relationship is found between exports
and foreign direct investment inflows in China between 1979 and 2021 in this study.
Additionally, the research investigates the temporal dynamics of the relationship
over the study period. The results of this study contribute to the existing body of
knowledge on the relationship between exports and FDI in China. The findings have
important implications for policymakers, providing insights into the effectiveness of
policies promoting exports and attracting FDI. The study also identifies areas for
further research and highlights the need for continued analysis as China's economic
landscape evolves.
