Economists are always susceptible to the criticism of taking too much of a macroeconomic overview. There are a growing number of papers that examine the determinants of the export decision of firms for developed and developing countries all of which ignore what is really happening on the ground.
This Silk Road article provides some of that information. This post is therefore written so I have a permanent record that I can refer back to, in a sense using this blog as a research diary (which is what I do when posting up abstracts of papers etc.).
This article throws up numerous questions that I may address again at later date.
Three and a Half Kinds of Factories [Silk Road International Blog]
It goes without saying that not all factories are created equal. Not all factories with international experience are equal either. Certainly there is a level that you’d prefer to work with if price was constant. But this isn’t a perfect world so we need to talk about with whom you actually choose to work.
If you’re not here on the ground every day, it’s helpful to know some generals about the differences in factories that are available here. This is certainly a sweeping generalization as there are possibly millions of factories in China. But I’ve worked with, audited and visited hundreds and hundreds of different factories here, in Thailand and Taiwan. And some generalizations are possible, I think, if for nothing other a base-point to start the discussion. So, here is my simplified overview of factory options with in China.
The article then discusses domestic, domestic/international, international and limited international.