Research On The Impact Of The Digital Economy Development Level Of The Host Country On China’s OFDI Under The "Belt And Road" Initiative

At present,the global economy is slowing down due to the epidemic,while the digital economy is playing a significant role in the new round of technological revolution and technological change.The digital economy has gradually changed the production and operation activities of countries,prompting the traditional manufacturing industry to begin to shift to the direction of digital intelligence,promoting the emergence of new industries,business models and modes,and promoting the development of national economies by reducing production costs and improving efficiency in all aspects.As the scale and economic impact of the digital economy grows,countries are paying more attention to the development of the digital economy,further promoting the improvement of their infrastructure and institutional progress,and attracting enterprises to invest in it.Since the"One Belt and One Road" was proposed,China has been cooperating more closely with countries along the "One Belt and One Road",and the level of digital economy development in the countries along the "One Belt and One Road" has been taken as an important factor for foreign direct investment."The study of the level of digital economy development in countries along the Belt and Road and its impact on China’s OFDI is not only beneficial for enterprises to make better OFDI choices,but also of great significance to guide the government to further open up.This paper mainly studies the level of digital economy development of the countries along the "Belt and Road" initiative,and empirically tests the impact of digital economy development of the countries along the route on China’s outward investment based on the measurement results.Firstly,based on previous studies,this paper summarizes the relevant literature on OFDI and digital economy development,clarifies the current research progress and results,and analyzes the role of digital economy development on different mechanisms of OFDI.Then,based on the research on digital economy theory in the previous paper,a digital economy development level indicator system is constructed based on three comprehensive considerations of infrastructure,institutional and innovation environment and industrial development application,and the level of digital economy development is measured using principal component analysis with a sample of 97 countries along the route.Finally,we use empirical analysis to test the viewpoints and prove the reliability of the results by endogeneity test,and then study the differences in different dimensions of digital economy,different types of countries and different motives,and explore the impact of digital economy development on Chinese enterprises’ foreign investment by cutting costs,improving efficiency and reducing risks,and study the relationship between the level of digital economy development in the riparian countries and China’s direct investment behavior in them.The study also examines the deep-seated relationship between the level of digital economy development and Chinese direct investment behavior in the countries along the route.The results of the study show that(1)there are significant differences in the level of digital economy development among the countries along the route in different regions,and using principal component analysis to rank them,Singapore in Southeast Asia,Switzerland in Europe and Korea in East Asia rank in the top three.(2)The scale of China’s OFDI shows a positive correlation with the level of digital economy development of the countries along the route,and it holds for countries of different income levels and different regions,among which,the impact of digital infrastructure construction on Chinese enterprises’ OFDI is the most obvious.(3)The larger the market size,the higher the foreign trade dependence,and the richer the level of natural resources and strategic assets of the countries along the route,the more attractive it is for China to make direct investment in them,while the higher the labor cost,the less China will invest in them.(4)In terms of investment motives,the level of digital economy development in the countries along the route can promote China’s OFDI in market and strategic asset-seeking enterprises,but the effect on efficiency and resource-seeking is not significant.(5)From the results of the mechanism test,the improvement of digital economy development level of the countries along the route can attract China’s OFDI to them through cost reduction,efficiency improvement and risk reduction.With regard to the strategic choice and development direction of China’s overseas investment in the context of digital economy,this paper puts forward the following relevant suggestions: to deeply examine the development of digital economy in the countries along the route,to actively adapt to the changes brought by digital economy,to better utilize the digital economy of the countries along the route,to promote OFDI,to seize the development opportunities,and to continuously improve its competitiveness in the world.