A Study on the Relationship between Outward Direct Investment in the Telecommunications Sector and the Hollowing Out of the Home Country's Industry-Based on Case Studies of Leading Enterprises in China, the US and Japan_Vol. 3 No. 4 (JMSD 2026)_Journal of Management and Social Development (ISSN: 3005-5741)

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A Study on the Relationship between Outward Direct Investment in the Telecommunications Sector and the Hollowing Out of the Home Country's Industry-Based on Case Studies of Leading Enterprises in China, the US and Japan

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DOI: https://doi.org/10.62517/jmsd.202612407

Author(s)

Wanying Wu

Affiliation(s)

Hainan Normal University, Haikou, Hainan, China *Corresponding Author

Abstract

Against the backdrop of economic globalisation and the restructuring of global value chains,the impact of outward foreign direct investment(OFDI)in the telecommunications sector on the development of home-country industries has attracted significant attention.This paper examines Huawei,Qualcomm and NTT Group-representative enterprises from the telecommunications sectors of China,the United States and Japan,respectively-to explore the mechanisms through which different OFDI models influence the hollowing-out of home-country industries,as well as the moderating roles of industrial chain integrity and the institutional environment.The findings reveal that strategic asset-seeking OFDI can mitigate industrial hollowing-out in the home country through reverse technology spillovers,whilst technology licensing-oriented OFDI helps maintain the stability of domestic industries.Cost-driven OFDI,however,is prone to inducing hollowing-out in the home country.A complete industrial chain and a suitable institutional environment can reinforce the positive effects of OFDI and mitigate the risks of hollowing-out.The conclusions of this study can serve as a reference for Chinese telecommunications enterprises in optimising their OFDI strategies and for the government in formulating industrial policies,whilst also providing insights for industrial upgrading in emerging economies.

Keywords

Telecommunications Industry; Outward Foreign Direct Investment(OFDI); Industrial Hollowing-out; Case Studies of China; the US and Japan

References

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