Investment liberalisation, technology take-off and export market entry: Does foreign ownership structure matter?

Prof. Sourafel Girma, University of Nottingham

We examine the role of foreign ownership structure in stimulating export market entry and R&D investment during a period of investment liberalisation following China’s accession to WTO in 2001. Focusing on firms with no prior exporting and R&D experience, we evaluate the causal effects of foreign acquisitions on the likelihood of exporting and investing in R&D for the first time. Using “doubly robust” propensity score reweighted logistic regression to control for the possible endogeneity of foreign acquisition and structure decisions, we uncover strong effects on export activity post-acquisition for all types of foreign ownership structure. We also find that targets that are taken over with a less than 100 per cent foreign ownership share experience higher likelihood of R&D, especially at the year of acquisition. Our results also suggest that joint ventures between foreign owners and Chinese firms can contribute positively to China’s “science and technology take-off”.

About the speaker
Sourafel Girma joined the University of Nottingham as a post-doc in 1996. He is currently Professor of Industrial Economics in the School of Economics . His main research interest is in applied microeconometrics, with special focus on international economics, industrial organisation and industrial economics. He has published several articles in international research outlets, including Journal of Industrial Economics, Journal of Econometrics, Journal of International Economics and European Economic Review. According to REPEC, which is the largest bibliographic database dedicated to Economics, he is ranked among the top 5% authors in terms of number of distinct works, citation index, number of journal pages and number of paper downloads. He has also been active in the field of knowledge transfer and policy advice, with consultancy work for the Department of Trade and Industry, UK Trade and Investment and the Treasury. For several years he acted as econometric advisor to HM Revenue and Customs. Sourafel’s research output has enjoyed several media appearances.

Date: 17 October 2013

Time: 12:30 - 13:30