The Selection of Investment Criteria for Taiwanese High-Tech Firms in China: Study of Grey Relation Analysis

Abstract

This paper aims to provide an analysis derived by grey relation approach in which an investment criteria for geographical location are selected by foreign firms among ten industrial zones in China. Attempts are made to provide suggestions to the government for improvement of investment areas in terms of environmental factors. This research adopts the statistical data investigated by Taiwan Electric and Electronic Manufacturers Association (TEEMA) in 2006, to make an empirical case analysis, using grey relation approach to evaluate the most critical factor of investment criteria for Taiwanese high-tech firms, while selecting ten major industrial zones in China. Several investment indicators such as city competitiveness, environmental factors, risk factors, and future development, are used as selected criteria in this method. The results reveal that the essential investment criteria for foreign firms in turn are investment environment, city competitiveness, and environment risk, according to the calculation of grey relation coefficient.