Apply DANP to Investigate the Determinants of Foreign Enterprises Investing in Taiwan Hi-Tech Industries


Foreign direct investment plays an important role in Taiwan's economic development. This paper investigates the criteria that MNEs use to assess the investment determinants in Taiwan. There are thirteen criteria extracted from past literature and classifies into five groups based on the OLI (Ownership, Location, International) theory proposed by Dunning (1980). The initial criteria are consulted with ten advanced experts and scholars through questionnaires to consolidate the research structure, then interviews another ten senior MNE managers face-to- face to collect their opinions for the relative importance of each pair of criteria by pair-wise comparison questionnaires. This paper adopts the DANP approach developed by Ou Yang et al. (2008) which combines DEMATEL and ANP procedures to analyze the priority of assess criteria. The research results show that the Government Policies Group and the Cluster Driven Seeking Group are the "main cause-factor" while the Market Seeking Group is the "main effect- factor" among the five groups. Cluster Driven Seeking Group also has significant relationships with other groups. Finally, the top three priority criteria are Re-Exports Opportunity, Governmental Incentives, and Industrial Clusters, while the last three priority criteria are Political Stability, Infrastructure, and Economic Environment. Even Taiwan faces the severe geopolitical tension, MNE managers still rank the Geopolitical Risk Criterion at the tenth priority.

Author Information
Yu-Jen Cheng, National University of Kaohsiung, Taiwan
Sih-Pei Chang, National University of Kaohsiung, Taiwan

Paper Information
Conference: ACSS2023
Stream: Economics and Management

This paper is part of the ACSS2023 Conference Proceedings (View)
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To cite this article:
Cheng Y., & Chang S. (2023) Apply DANP to Investigate the Determinants of Foreign Enterprises Investing in Taiwan Hi-Tech Industries ISSN: 2186-2303 – The Asian Conference on the Social Sciences 2023: Official Conference Proceedings
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Posted by James Alexander Gordon