Spatial analysis of factors affecting location decisions of Korean companies in China

This study identifies a significant spatial heterogeneity of regional economic capacities that affects the distribution of Korean companies in China. The study uses provincial-level data from 2003 to 2012 for 29 Chinese provinces to conduct both global and spatial models. The results indicate significant spatial variation in the impact of regional economic capacity on Korean company locations, and this leads to inconsistent global model results. Moreover, the spatial results show spatial differences between the manufacturing and service sectors. This implies that company expansion strategies in China's balanced growth era should consider this provincial spatial heterogeneity of economic capacities.