Prema-chandra Athukorala: This paper examines the impact of increase in domestic wages on FDI inflows to China focusing on two interesting issues: how do domestic wage increases change the inter-province distribution of FDI in China; and do wage differentials with China impact on shifting FDI inflows from China to neighboring Asian countries. The empirical analysis is based on two new annual panel data sets covering 29 provinces in China, and China and six major member countries of ASEAN (Indonesia, Cambodia, Laos, the Philippines, Thailand, and Vietnam) from 2005 to 2015. The findings suggest that wage increases in China have a statistically and economically significant effect on both inter-province allocation of FDI within China and the relative attractiveness for foreign investors of China's low-income neighbors. The econometrics of the paper are sound, as...
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June 01 2018
Comments by Prema-chandra Athukorala, on The End of Cheap Labor: Are Foreign Investors Leaving China?
Online Issn: 1536-0083
Print Issn: 1535-3516
© 2018 by the Asian Economic Panel and the Massachusetts Institute of Technology
Massachusetts Institute of Technology
Asian Economic Papers (2018) 17 (2): 108–109.
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Comments by Prema-chandra Athukorala, on The End of Cheap Labor: Are Foreign Investors Leaving China?. Asian Economic Papers 2018; 17 (2): 108–109. doi: https://doi.org/10.1162/asep_a_00612
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