Chinese cross-border M&As in the 'One Belt One Road' countries: The impact of Confucius Institutes

摘要

As the "One Belt One Road" (OBOR) initiative enters a new stage of substantive construction, Chinese cross-border mergers and acquisitions (M&As) are significantly increasing in the OBOR areas. Acknowledging this trend and drawing on institutional theory, this study investigates the impact of the Confucius Institute on China's cross-border M&As in the OBOR countries. It also examines how this impact is moderated by Bilateral Investment Treaties (BITs) and by comparable superior economic development and political-institution quality between home and host countries. The findings suggest that Confucius Institutes have a positive effect on the completion of M&As in OBOR countries. The effect is greater if a host country has BITs signed with China or if it has better economic development than China. This implies that, to facilitate Chinese firms' investments in OBOR areas, China should actively participate in cultural exchange activities and the establishment of Confucius Institutes should focus on those countries that have BITs with China, or which have better economic development.