ABSTRACT
The Chinese government has used policy and law to bargain and bluff foreign investors into providing contract terms favorable to China's interests. The results of foreign investment in China indicate that many of the fears of Western Marxist critics of multinational corporations do not apply there, because the state has effectively intervened to protect perceived national interests. Neo-Marxist concerns about displacement of indigenous production are irrelevant to the Chinese case. The dramatic evidence of unequal distribution concerns differences in investment levels among China's regions. Reports on foreign investment in China have mixed implications about the extent and appropriateness of technology transfer. One tendency in Chinese policy has been to take a generous approach to hard currency shortfalls, sharing the burden where necessary in order to attract investment. Despite the partial decentralization of control over the domestic economy, foreign investors were not able to manipulate local conditions greatly to their advantage and realize more exploitive relations with the host country.
