China Plus One: An Analysis of Taiwanese High-Tech Industries FDI in China and Vietnam from the Perspectives of the Eclectic Paradigm and Technology Transfer
Yung-Pin Tseng*, Wei-Hwa Pan and Tsungting Chung
Abstract
This study adopts a firm-level perspective, integrating the Eclectic Theory (OLI Paradigm) and technology transfer perspectives to establish a dynamic "OLI-TT" integrated framework. It examines the decision-making factors influencing FDI location choices in China and Vietnam for Taiwanese high-tech firms. A survey was administered to mid-level and senior managers from 168 Taiwanese parent companies with investments in China and Vietnam, utilizing a 7-point Likert scale. The research methodology involved first assessing the goodness-of-fit between the theoretical model and the collected data, followed by the application of conditional logistic analysis to empirically test 14 research hypotheses derived from the OLI framework and technology transfer theory.
The Empirical Results Indicate
• All hypotheses were statistically supported (p < .05), validating the explanatory power of the "OLI-TT" framework.
• Investment experience (OR = 2.91) and market factors (OR = 2.61) were the strongest facilitating factors, while cultural distance (OR = 0.33) and investment risk (OR = 0.35) were the strongest inhibiting factors.
• Technology performance variables explained 32.7% of the location decision variance (ΔR² = .327).
• The model demonstrated good fit (Hosmer-Lemeshow test, p = .324), high overall explanatory power (Nagelkerke R² = .68), and statistical significance (χ² = 178.94, p < .001).
The research confirms that under the China Plus One strategy, Taiwanese firms simultaneously weigh traditional location-specific advantages and technology transfer performance, with risk aversion being a critical decision factor. This provides an important empirical foundation for investment theory in emerging economies.
