Migrant Networks, Greenfield FDI and Cross-Border Mergers and Acquisitions

This paper studies the impact of overseas Chinese networks on Chinese outward greenfield FDI and cross-border mergers and acquisitions or brownfield investments. Greenfield and brownfield investment that differ in job creation and technology transfer face different entrance barriers. We find that overseas Chinese networks are more closely associated with brownfield investment than greenfield investment. The relation between overseas Chinese networks and Chinese outward investment is more pronounced for investment from private-own enterprises, in the tertiary sector, and in host countries with lower trust, less efficient contract enforcement, and more regulations.