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This paper investigates how the gap between the host country's actual and optimal financial conditions affects foreign direct investment (FDI) inflows through evidence from China.

The authors first employ principal component analysis (PCA) to measure FDI target countries' actual financial conditions and use 30 OECD countries as a reference group to assess the optimal financial condition. The authors then estimate a two-way fixed effect model with panel data of China's outward FDI in 64 countries for the period 2003–2017 to get the regression results. The authors' results overcome endogeneity and are robust.

Results show that (1) the gaps between host countries' actual and optimal financial conditions positively affect FDI inflows from China; (2) there is a heterogeneous effect between low-income and high-income countries. The gaps for high-income countries significantly increase FDI inflows from China, while the gaps are not significant for low-income countries.

The authors examine how the gap affects FDI inflows from China. An increase of 1% in the target country's gap promotes a 6.3% increase in FDI inflows. However, the authors do not explore what mechanisms are key to these results. The authors will explore these questions in the future.

This paper complements the influence factors of FDI and enriches theories of FDI. The gap between actual and optimal financial conditions plays an essential role in FDI flows across countries for policymakers.

The purpose of this paper is to investigate the electrochemical corrosion behavior of type 444 stainless steel (SS) in synthetic tap water from 25°C to 80°C, i.e. the operation environment of the electric water heater.

The corrosion behavior was studied by using electrochemical measurements such as electrochemical impedance spectroscopy and polarization curve. The specimen surfaces were observed with scanning electron microscopy. The passive films were characterized with X-ray photoelectron spectroscopy.

In the typical tap water, 444 SS passivates spontaneously under different temperatures. The passive films formed at higher temperatures contain relatively less Cr-species and more Cl⁻ ions, resulting in lower polarization resistances. The stable pitting corrosion takes place in the potential region of oxygen evolution as the temperature increases to about 55°C. The critical Cl⁻ concentration of pitting corrosion reduces from about 160 mg L⁻¹ to 60 mg L⁻¹ with changing temperature from 25°C to 80°C.

The pitting corrosion probability was assessed through the statistical analysis of tap water quality. The results are useful for the application of 444 SS as well as the design of electric water heater.

This paper shows the variation of polarization resistance, pitting potential, passive film composition and critical pitting chloride concentration with the temperature of tap water. It is of great significance for the development and application of SS in tap water environments.