Foreign Direct Investment along the Belt and Road


J.T. Li

The Belt and Road Initiative launched by the Chinese government in 2013 has aroused massive global attention and engendered profound impact. Given the various parties involved and intricate relationships between them, there is great complexity regarding the implementation of the projects. In this project, we draw from the institutional and geopolitical perspectives to examine the selection and participation of host and third-party country firms in BRI projects. We portray firm selection in a BRI project as the outcome of a one-tier bargaining game between China and a host country. Institutions and geopolitics influence both the legitimacy gap of Chinese SOEs in a host country and their relative bargaining power, which shapes the likelihood of a host or third country firm’s participation in BRI projects. We aim to offer a more nuanced understanding of how BRI projects unfold in its implementation and shed light on the negotiation logistics in the process. 

Principal Investigator (PI):  J.T. Li, Department of Management

This project is funded by the HKUST IEMS Research Grants 2021.

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