Managers’ country-specific experience and outward foreign direct investment: China and cross-countries’ evidence

Using a sample of Chinese listed companies, we provide evidence that firms with managers’ country-specific experience (MCSE) are more likely to engage in outward foreign direct investment (OFDI) in destinations for which their CEOs and chairpersons have worked or studied. Potential mechanisms show that MCSE is particularly important for firms facing more severe ex ante information asymmetry about the destination and lacking export experience before OFDI. We also find that MCSE, not overseas experience in general, makes firms more likely to invest in a specific destination. The country-specific knowledge or network of overseas returnees is important in driving OFDI.