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Chinese FDI, Local Innovation Systems, and New Growth Paths in the United States

Authors: Hao Huang*, Illinois Institute of Technology
Topics: Economic Geography, Business Geography, China
Keywords: FDI, Innovation, Growth, China, United States
Session Type: Paper
Presentation File: No File Uploaded

This research aims to contribute to the debate on regional industrial path development by exploring the role that FDI can play in path branching and path creation in the regional studies literature. The patterns of exogenously led path development vary substantially depending on the regional context since regions differ not only in their attraction to FDI but also in their capacities to absorb it and benefit from it and transform it into a new path development by knowledge spillover effects of FDI on regional innovations. The nexus between FDI, local innovation systems, and new growth paths in regions, however, is still poorly understood. This research contributes to this understanding by providing (1) a typology of institutional conditions and constraints for multinational subsidiary global-local connections, (2) new empirical evidences on how FDI, affected by region-specific institutions and their interplay with institutions at other spatial scales, promotes or impedes knowledge spillovers for a new path development, (3) a framework to identify types of institutions and forms and directions of institutional change attracting FDI and facilitating positive spillover effects of FDI for exogenously driven path development.

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