Chinese investment strategies and migration : does diaspora matter? : a Case study on Germany

Abstract

This paper studies the role that Chinese migrants play in the development of investment relations between China and Germany. We assume that Chinese migrants can help to overcome the psychic distance that exists between the two countries, a distance that esults in high information costs for Chinese companies with regard to investment opportunities, government regulations and/or the trustworthiness of potential business partners in Germany. We also look at Chinese diaspora networks assuming that they can educe transactions costs and can have foreign direct investment (FDI)-creating effects.