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Foreign ownership structure of service equity joint ventures in China

Doren D. Chadee (Department of International Business, The University of Auckland, Auckland, New Zealand)

International Journal of Service Industry Management

ISSN: 0956-4233

Article publication date: 1 May 2002

Abstract

This paper investigates the foreign ownership structure of service equity joint ventures (EJVs) in China. In less than 20 years, China has emerged from a closed economy to become the second largest recipient of foreign direct investment (FDI) in the world. Now that China is a member of the World Trade Organisation, liberalisation of FDI is expected to accelerate even further. Despite the fact that an increasing proportion of FDI in China is in the form of equity joint ventures in the service sector, little is known of the ownership structure of service EJVs. Using a database of 6,430 foreign EJVs, in China from 1984 to 1996, this paper shows that foreign equity ownership differs significantly between service and manufacturing EJVs with foreign ownership generally being higher in service EJVs. The overall results also suggest that the gradual liberalisation of FDI in the service sector by Chinese authorities has had a positive effect on foreign equity ownership.

Keywords

Citation

Chadee, D.D. (2002), "Foreign ownership structure of service equity joint ventures in China", International Journal of Service Industry Management, Vol. 13 No. 2, pp. 181-201. https://doi.org/10.1108/09564230210425368

Publisher

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MCB UP Ltd

Copyright © 2002, MCB UP Limited