Does Outward Foreign Direct Investment Affect Home-country Employment: Based on
China’s Micro-level Enterprises Database
Abstract In the context of rapidly growing Chinese
enterprises’ OFDI，this paper theoretically and empirically analyzes the influence of
OFDI to Chinese domestic employment. The theoretical models are built to analyze
the influence mechanism by which OFDI impact domestic employment. The empirical
results show that OFDI of Chinese enterprises has a significant and positive
impact on domestic employment. Meanwhile, the more times enterprises invest, the
more labors that the parent company will employ. The impact is robust to
enterprise’ ownership types and the income levels of investment destination. Different
investment motivations have different impact on employment. The effect produced
by enterprises’ resource-seeking OFDI to employment of its parent company is
affected by industry classification, and the effect produced by enterprises’ horizontal and vertical OFDI to its parent
company’ s employment is affected by income levels, import and export of
intermediate product and final product.
This paper is published in Economic Research Journal, No.8, 2016.