ABSTRACT
In the two decades since 1979, China, Taiwan, and Hong Kong have become one integrated economic region, driving the dramatic growth of investment, production, and trade in East Asia. Often referred to as “the greater Chinese economy,” this region represents in certain respects the triumph of economics over politics, in the sense that the three very different political entities have today become an economic trading, investing, and producing region, despite political and military conflict and long-standing, deep-seated suspicion and mistrust. FDI has been the engine driving these three entities into an increasingly intimate relationship (Ash and Kueh 1993; Naughton 1997).
