CAUSAL AND INFLUENCE ANALYSIS OF FDI FLOW TO CHINA USING FUZZY COGNITIVE MAPS (CASE STUDY 1998-2016)

Abstract

China as a major emerging market, is attracted significant flows of Foreign Direct
Investment (FDI) to become second largest receipt. This research briefly examines the
determinants of FDI obtained from literature and secondary data from World Bank and
Global Competitiveness Index within 1998-2016, updating from prior research within
1996-2012. Fuzzy Cognitive Maps (FCMs) is employed as an analysis method to
investigate the causal-effect relationships between the determinants by the application
of soft computing technique of FCM using FCMMappers. Furthermore, FCM
simulation of concepts/parameters change to understand the c ausal influence amongst
concepts. The FCM simulation handle efficiently with complex modeling problems to
assess determinants of FDI Flow to China.