| Since the reform and opening up, China’s economy has sustained rapid growth, the total economic output in2012has been ranked second in the world for three consecutive years. Since proposed the strategy of "going out", goods and capital have been moving toward the international market, in2012China has become the world’s first exports of goods trade, the world’s second big import country, the world’s third big capital exporter.From China’s macroeconomic statistics, China’s export mainly in countries or regions with higher institutional quality, lower institutional quality countries or regions to export less. From the geographical structure of the outward foreign investment, Chinese enterprises invest in smaller institutional distance countries or regions, higher institutional quality countries or regions’s investment is gradually developing. Effective institutional arrangements can reduce transaction costs, improve product competitiveness, institutional factor is the most basic factor of national wealth,far more than the resources, population, capital and other factors, the institutional is the key factor affecting China’s export and outward foreign direct investment, China’s commodity export and capital output not only prefer the economic highly developed countries or regions, but prefer the institutional of relatively high quality countries or regions. Institutional arrangements have a significant impact on a country’s foreign trade and outward foreign investment, so study the impact of destination country’s institutional to China’s export and outward foreign direct investment location choice has very important theoretical and practical significance.Based on the analysis of China’s export and foreign investment’s histoiy and current situation,the institutional is divided into the formal and informal institutional,explains the influence on export and outward foreign investment, by setting therelated index institutional to build the evaluation index institutional, build mathematical model of the relationship among nstitutional arrangements,Chinese export and outward foreign investment. Using the statistical data of the China export and outward foreign investment, from the institutional quality and institutional distance, study the institutional effect on the export and foreign investment location distribution, and study the institutional arrangements’ comprehensive influence to China export and outward foreign investment choice, is supplement and the development of international trade theory and institutional economics theory. The innovation of this paper is mainly manifested in the:First, starting from the microscopic foundation of gravity model, using the utility function embedded institutional variables in trade gravity model, and based on this model, using the representative countries or regions’statistical data, respectively to study the effect of whole institutional,individual institutional quality and single institutional quality of an index to geographic structure of China export,explore the law of the geographical distribution of China’s export. In this paper, classification of the institutional in more detail, the research institutional on the impact of China’s export trade is more comprehensive and in-depth.Second, the institutional variables were embedded in the investment gravity model, and establish the econometric model,using the representative countries or regions’statistical data, respectively to study the effect of whole institutional,individual institutional quality and single institutional quality of an index to geographic structure of outward foreign investment,explore the inherent laws of location distribution of outward foreign direct investment.The research institutions on the impact of China’s outward foreign direct investment location choice is more comprehensive and in-depth.Third, to explore Chinese export and outward foreign direct investment location choice relationship from the perspective of transaction cost,Chinese export and outward foreign investment distributed in nearly two hundred countries or regions, but the distribution is relatively concentrated and the features of internal rules, the existing literature mainly focus on economic factors,this paper tries to analyze the institutional factors which influence export and investment decision. Fourth, from the customs union theory, constructs a theoretical model to study the effect of language to our country’s export trade and investment, using human input and capital input as the language cost’s proxy variable, study the effect of language to export and outward foreign investment location choice, the language of economics and international trade together, is complementary and development to the existing international trade theory.Through theoretical and empirical analysis main conclusions of this paper are:First, China’s export preferences for high quality institutional of the country or regionHigher institutional quality of the importing country means the government work efficiency is high, the state of the market more stringent regulation,can provide more political guarantee for exporter,so has greater gravity on China’s commodity.High quality economic institutional means that trade and economic policy is more free, the market competition environment more equitable, trade barrier is relatively low, it is advantageous to reduce the transaction costs and improve the products’ competitiveness,high quality institutional is an important factor in attracting Chinese products. Legal good running environment can effectively punish the transaction’s breach of contract, protect the interests of import and export business.Therefore,the export should not only consider the country’s level of economic development but also consider the institutional quality of the importing country. High quality national institutional can reduce the possible risk and uncertainty, is conducive to the transaction. We should pay attention to the institutional of quality of the importing country, at the same time, it should also be noted that China’s institutional of quality world ranking is lower by comparison, there is a great potential for comparative advantage of our country’s institutional.In the future to further deepen the institutional reform, improve institutional quality, promote the transformation of comparative advantage to the competitive advantage of the institutional, play the role of promoting the institutional of China’s national economy.Second, China’s outward foreign direct investment preference for high quality institutional of the country or region Compared to the export,the Multi-National Corporation’s overseas investment is affected by the host country institutional environment more, not only sales in the host country, but production did in the host country.The Multi-National Corporation production of institutional legitimacy is an important determinant of business success factors.The higher quality institutional can provide guarantee for the free flow of capital, the localization management of Multi-National Corporation are subject to the impact of the host country institutional environment from raw materials procurement, production and processing as well as hiring, market sales.If the host can provide support to investors, will help to reduce the transaction cost, with investors profit maximization of the business strategy. On the contrary, the poor quality of the institutional can not only provide support good institutional investors, political risk exists even make investors face the risk of capital loss. After thirty years of reform and opening up, China’s socialist market economic institutional gradually perfect, but the law degree is relatively low. is the important reason for boosting China’s capital output. But at present, the capital output is still in the development stage of the lower level, the target region is not very clear, gravity force domestic than foreign.Third, enterprises in transnational operation decision-making for high quality country or region, tend to the larger institutional distance countries or regions to export, institutional smaller countries or areas to investmentHigh quality institutional country or region has great attraction to our export and outward foreign direct investment, the higher the quality of the target country institutional means that the institutional is relatively perfect, can provide the institutional safeguard for the transnational operation of enterprises,reduce the transaction cost. But the institutional of the target is not the higher the necessarily conducive to maximize profits, at the same time higher institutional quality also means the institutional differences with China’s larger difference, institutional will enable the operator to face more institutional environment strange.International trading is different from domestic trading, the operator must familiar with and adapt to the target country’s environment can operate successfully. Enteiprise first identified in the transnational business choose high institutional quality area, then choose the export business model and the investment management mode, there is a close relationship between the policy and institutional distance, when institutional distance is big means transaction cost operators greater, export mode in this case for maximum profit, when the distance is small means transaction cost operators may be smaller, pattern of transnational investment in this case may be the optimal decision. Investment mode is greatly affected by the host country institutional factors, the export model from the importing country institutional environment constraints are relatively small, rational enterprises in transnational operation decision-making for high quality country or region, tend to the institutional away from the larger countries or regions to export, institutional distance smaller countries or areas of investment, which is beneficial to realize profit maximization.Fourth, informal institutional language has an important impact on exports and investmentSince the reform and opening up, especially joining the WTO, China’s output of goods and capital export growth, export volume ranked first in the world, the outward foreign investment flows has ranked third in the world, huge export and outward foreign investment to make a great contribution to the economic growth. In the development of transnational business,because of the language differences will have communication obstacles,to solve the communication obstacles, one country must learn another language, and the language learning needs cost. At present, Chinese is not the international language, China’s trade with the major countries, often have to use English or other languages, so it takes a lot of language learning cost. In this paper, the study of language influence on export and foreign direct investment, that language is a kind of transaction cost. Under the condition of open economy, small is mainly responsible for the cost of the language. With the increase of the number of their learning international language, there is a limit number of this learning language proportion, if more than the limit it will hinder the development of international trade. Language learning capital increase can also promote the development of foreign trade and economic relations.Language international promotion to reduce transaction costs.If there is a unified international language in the world, the international economic and trade exchanges would no longer need to learn a variety of language, language learning costs will be greatly reduced, the communication between countries will be more convenient, is conducive to the development of international trade and the global economy. |
