Thesis Chapter 3 on Linkages Between Foreign Affiliates and Domestic Firms in Chinese Automobile Industry


Thesis Chapter 3

Linkages Between Foreign Affiliates and Domestic Firms in Chinese Automobile Industry

(948 Words)


This chapter shall discuss the research methods available for the study and what is applicable for it to use. Likewise the chapter shall present how the research will be implemented and how to come up with pertinent findings.


Method of Research to be Used

There are three kinds of research methods, correlational, experimental and descriptive. (Walliman and Baiche, 2001) The correlational kind of research method is used due to ethical problems with experiments. Moreover, it is also used due to practical problems with experiments. Moreover, inferring causality from correlation not actually impossible, but very difficult. This mode of study is widely applicable, cheap, and usually ethical. Nonetheless, there exist some “third variable” issues and measurement problems. The correlational research refers to studies in which the purpose is to discover relationships between variables through the use of correlational statistics (r). The square of a correlation coefficient yields the explained variance (r-squared). A correlational relationship between two variables is occasionally the result of an outside source, so we have to be careful and remember that correlation does not necessarily tell us about cause and effect. If a strong relationship is found between two variables, using an experimental approach can test causality.


On the other hand, the experimental method is the only method that can be used to establish cause-and-effect relationships. (Creswell, 1994) That is, it is the only one that can be used to explain the bases of behavior and mental processes. In this method, the subjects are split into two (or more) groups. One group, called the experimental group gets the treatment that the researcher believes will cause something to happen (this treatment is formally called the independent variable). The experimental and control groups are compared on some variable that is presumed to reflect the effects of the treatment, or outcome. This is formally referred to as the dependent variable.


And lastly, the descriptive research method uses observation and surveys. In this method, it is possible that the study would be cheap and quick. It could also suggest unanticipated hypotheses. Nonetheless, it would be very hard to rule out alternative explanations and especially infer causations. Thus, this study will use the descriptive approach.  This descriptive type of research will utilize observations in the study.  To illustrate the descriptive type of research, Creswell (1994) will guide the researcher when he stated: Descriptive method of research is to gather information about the present existing condition.  The purpose of employing this method is to describe the nature of a situation, as it exists at the time of the study and to explore the cause/s of particular phenomena. The researcher opted to use this kind of research considering the desire of the researcher to obtain first hand data from the respondents so as to formulate rational and sound conclusions and recommendations for the study.


The research described in this document is based solely on qualitative research methods. This permits a flexible and iterative approach. During data gathering the choice and design of methods are constantly modified, based on ongoing analysis. This allows investigation of important new issues and questions as they arise, and allows the investigators to drop unproductive areas of research from the original research plan.


This study basically intends to identify the linkages between foreign affiliates and domestic firms in the Chinese automobile industry. Specifically, the study seeks to distinguish the methods undertaken by the automotive industry in China with respect to the changes brought about by the opening of the economy to world trade.


The primary source of data will come from published articles from social science journals, theses and related studies on economics, international trade, and those pertaining to the automotive industry.


For this research design, the researcher will gather data, collate published studies from different local and foreign universities and articles from social science journals; and make a content analysis of the collected documentary and verbal material.  Afterwards, the researcher will summarize all the information, make a conclusion based on the null hypotheses posited and provide insightful recommendations on the dealing with the automotive industry of China.



Little sense can be made of a huge collection of data; therefore an essential part of research is the analysis of the data. This data must be carried out in relation to the research problem. (Walliman and Baiche, 2001) Because research is not a linear process, the only way to help us to judge the type of and amount of data is to decide on the methods, which we will use to analyze them to obtain a feel for the data, establish reliability and to understand how the results are interpreted.


Qualitative data are based on meanings expressed through words. It results in the collection of non-standardized data, which requires classification, and is analyzed through the use of conceptualization. (Sounders et al, 1997) In this research, the researcher would also need to get some qualitative data through a number of the process of qualitative analysis, including document and interim summaries, self-memos, etc.


Thus, the dependent variable is the variable of primary interest to the researcher. The researcher’s goal is to understand and describe the dependent variable, or explain its variability, or predict it.  Through the analysis of the dependent variable, it is possible to find answers or solutions to the problem. (Sekaran, 2000) Furthermore, an independent variable is one that influences the dependent variable in either a positive or a negative way. As a result the researcher will use a systematic explanatory and exploratory research and focus on those dependent variables. The relationships of the variables will be designed in detail, based on the understanding the independent variables of the automotive industry in China.