@article {Lin:2009:0003-6846:1191,
	author = "Lin, Hui-Lin and Yeh, Ryh-song and Chung, Ching-Fan",
	title = "The effect of outward investment to China on domestic RD: a two-hurdle model with endogenous ODI",
	journal = "Applied Economics",
	volume = "41",
	number = "9",
	year = "2009",
	abstract = "Outward direct investment (ODI) and domestic R&D are interrelated, but empirical evidence is affected by the nature of a firm's data, which are heavily censored. Firm data contain a firm's yes/no decision to invest in China, yes/no decision of R&D, and the decision of R&D intensity. We thus adopt a two-hurdle model and allow the China investment decision to be endogenous in an R&D model in order to examine the effect of ODI in China on domestic R&D investment in Taiwan's electronics industry. In the model, a two-equation simultaneous subsystem is formed, in which three regression equations are specified: a decision of R&D intensity, and a yes/no decision of location to conduct R&D together with a yes/no decision to invest in China Our results indicate that China investment and R&D intensity are positively related such that ODI in China helps to raise significantly a firm's R&D intensity as compared to the estimate if the endogeneity of China investment and the nature of data were not properly accounted.",
	pages = "1191-1198",
	url = "http://www.ingentaconnect.com/content/routledg/raef/2009/00000041/00000009/art00011",
	doi = "doi:10.1080/00036840601019224"
}