The Impact Of Cultural Differences On The Location Of China’s Outward Foreign Direct Investment

In recent years,more and more Chinese multinationals go out and have made a huge amount of foreign direct investment abroad, making China one of the world’s leading foreign investors. The sharply growth in China’s OFDI has attracted the attention of many scholars at home and abroad, but most of them are based on the macro data and study on an overall inspection, very few literature research this problem based on the micro data and study separately under different OFDI motivations. From the perspective of the cultural differences, based on the panel OFDI project data of 102 countries（regions）, using genetic distance measure the cultural differences between the host country（region） and home country（region）, this paper tries to make analysis on China’s OFDI location choice on overall inspection and separately from the market-seeking motivation, resources-seeking motivation and technology-seeking motivation.Our result shows that: genetic distance will have a negative impact on OFDI of China’s multinational enterprises, and they prefer to invest in countries（regions） that have small genetic distance in order to reduce the cost and risk. Further, the degree of negative impact of genetic distance on China’s OFDI location choice varies from investment motivation. The negative impact to Chinese technology-seeking OFDI is the largest, followed by market-seeking OFDI and resources-seeking OFDI. Finally, the impact of genetic distance on China’s OFDI location choices has obvious regional differences. It has a significant negative impact on market-seeking OFDI from both region, but shows no significant influence for the resource-seeking, technology-seeking OFDI from provinces that have less overseas Chinese.