Abstract: Based on the decomposition of export price in heterogeneous product model, we estimate export quality and quality-adjusted price(export product cost) during the period of 2003-2016, and then we examine quality effect and cost effect of China's OFDI on export. The empirical results show that China's OFDI brings about a positive effect on export quality,a negative effect on product cost. Then we analyze heterogeneous influences and find that, before Financial Crisis, China's OFDI to countries with highest-level income improves export quality and reduces product cost; while after Financial Crisis, these effects above are realized by OFDI to countries with middle-low-level income. From types of products, we find that China's OFDI significantly improves export quality of heterogeneous goods & intermediates goods, and reduces product cost of them; while for homogeneous products & final products, OFDI only has a significant lowering effect on cost.

Key words: export price decomposition, China's OFDI, quality effect, cost effect