FDI Through The Imitation Procedure: The Case of China

Over the past decades great changes have taken place in the economic environment worldwide regarding the foreign direct investment (F.D.I.). However, some of the developing countries have managed to gain more F.D.I. compared to other developing countries via skills acquisition, competition, exports and imitation. These spillovers channels are used to transfer technological knowledge among firms, while the imitation is used by many multinational enterprises (MNEs) and it is considered one of the most important spillovers channels. Therefore, many Chinese enterprises have imitated the developed countries firms’ managerial and production procedures so far. China is one the largest recipient of F.D.I. inflow worldwide and the country’s development affects the policies and the growth of other developing countries. Hence, under certain circumstances, developing countries have the ability to attract F.D.I. through imitating China.