Reversal of Fortunes: Chinese Foreign Direct Investment in Advanced Economies

The sharp increase in Chinese investments in advanced economies poses unique challenges and opportunities. On the one hand, China’s outward FDI faces increased scrutiny abroad due to economic and political competition between the United States and its allies with China. On the other hand, Chinese financial flows provide needed investments in developed economies. Local governments in the United States and Europe, in particular, perceive that Chinese investments can help save companies from bankruptcy, generate jobs, and upgrade critical infrastructure. How do governments in advanced economies respond to Chinese investments? Which investment projects are more likely to be accepted and which ones are more likely to generate political backlash? What actors are more likely to support or oppose Chinese investments? This project speak to Kellogg's interest in understanding the political foundations of an open, liberal economy and the conditions under which we may turn towards more protectionist policies.