Study On The Causes And Motivations Of China’s Ofdi Location Selection From The Perspective Of Global Value Chain

China’s outward foreign direct investment(OFDI)has grown rapidly in recent years,and it has gradually surpassed foreign direct investment(FDI).At the same time,China’s OFDI shows the characteristics of large-scale flows to developed economies,which is very different from the historical experience of developed economies.China’s economic development has always been unique in the world,and China has once again demonstrated this particularity in the field of OFDI.This phenomenon has never been seen in developing countries,and there is no in-depth and systematic discussion on from the perspective of development economics.The purpose of my study is to explain why this particularity exists,and to explore the causes and motivations behind it.Since the late 1980 s,global economic integration has gradually evolved into global value chain trade and labour division system.Unlike the traditional international economic system in which countries specialize in a certain industry(having a complete production chain in a certain industry),under the global value chain system,vertical specialization becomes increasingly common,and countries are gradually specializing in a certain production stage or activity.In today’s world,international trade and international capital flows are greatly affected by the global value chain system.Since joining the WTO in 2001,China has fully integrated into the global value chain system.Therefore,according to the characteristics of China’s OFDI,the research studies the causes and motivations of China’s OFDI location selection based on the perspective of global value chain.This dissertation constructs a “two-single-sector dual-production stage” costrevenue model to analyze the internal economic causes of Chinas OFDI in the global value chain system from the short-term and long-term dimensions,and conducts a numerical simulation.The analysis of the theoretical mechanism shows that the inherent reason for the characteristics of China’s OFDI is its own economic development level(development stage).This is also the core argument of this study: the level of economic development(development stage)is the internal cause,which determines the characteristics of China’s OFDI.The scale of China’s OFDI is influenced by many factors,such as: host country’s tax restraint,intermediate product profit rate;investment country’s learning speed and R&D intensity,intermediate product profit rate,intermediate product investment amount,etc.From the results of numerical simulations,different factors have different effects on China’s optimal investment volume.This dissertation uses global value chain position to characterize the level of economic development.Therefore,from the perspective of the global value chain,a country’s relative position in the global value chain system profoundly affects its OFDI.This study empirically tests the theoretical hypothesis from the two dimensions of national level and industry level.It verifies the effect of the relative level of China’s economic development(relative global value chain position)on China’s OFDI.Chin’s OFDI has different motivations in different countries and different industries.First,the narrowing of the global value chain position gap has promoted China’s OFDI,but the bilateral and forward-backward global value chain position gaps have different paths for China’s OFDI location selection,and considering the positive and negative global value chain gaps,we further clarify that there are structural differences in China’s OFDI location selection.Second,China’s OFDI shows multiple motivations: OFDI in economies with high global value chain position is mainly driven by market or strategic asset seeking motivation,but there is no obvious “reverse technology spillover effect”.The OFDI in economies with low global value chain position is mainly driven by market or resource seeking motivation,and can enhance China’s position in the global value chain system.Third,for different industries,the flow direction of China’s OFDI is affected by the relative industrial global value chain position between China and the host countries.China is more inclined to invest in industries of which its backward global value chain position is improving.The world today is facing a critical change point,and the international economic pattern is undergoing a profound transformation.The sudden “COVID-19 virus”(coronavirus)" has exacerbated the uncertainty of the world economy and accelerated the transformation of the international economic pattern.China’s countermeasures in such an international situation not only have a huge impact on China’s own OFDI,but also have important practical significance for other aspects of China’s economic development,and even have an important impact on the future pattern of the world economy.Based on the analysis paradigm of Marxist political economy,this article analyzes the essence of the global value chain system and the mechanism of the evolution of China’s position in the global value chain system.Based on data analysis,this article predicts the development trend of the global value chain system and analyzes China’s challenges and opportunities.Meanwhile,we analyzes the welfare effect under different economic development models.With regard to the huge uncertainty brought about by the “COVID-19”,this article analyzes its impact on China’s “reform standards”.On this basis policy recommendations are made.Under the current global value chain system dominated by Western countries led by the USA,different countries takes different global value chain positions.The United States is at the highest end of the global value chain,other developed countries are at the high-end position,and the majority of developing countries are at the low-end position.This system is inherently full of inequality.On the basis of the improvement of China’s state governance capacity,and the interaction between the level of economic development and the economic development pattern,the global value chain position continues to increase.The global value chain system is undergoing a profound transformation,and global value chain trade and labour division have already stalled.But there is still much room for cooperation between China and other countries.In the short term,although globalization has stalled or even regressed,in the long run,the trend of globalization is unstoppable.The most critical thing for China to deal with the profound transformation of the international economic system and various challenges is to choose the correct development pattern and enhance the level of economic development.At the same time,in the future,China must be firm in its global development ideas,help other countries to develop while developing itself,and achieve better development in the process of other countries’ development.