Global Business Environment. Economic environment: capital movement, FDI. Readings. World Investment Report 2009 . Overview. pp. 4-22. http://www.unctad.org/en/docs/ wir2009overview_en.pdf The OLI Paradigm. http://www.investmentsandincome.com/investments/oli-paradigm.html.
Economic environment: capital movement, FDI
World Investment Report 2009. Overview. pp. 4-22. http://www.unctad.org/en/docs/wir2009overview_en.pdf
The OLI Paradigm. http://www.investmentsandincome.com/investments/oli-paradigm.html
Foreign direct investment refers to investment in which a firm in one country directly controls or owns a subsidiary in another.
If a foreign company invests in at least 10% of the stock in a subsidiary, the two firms are typically classified as a multinational corporation.
Why are multinational corporations created and why do they undertake direct foreign investment?
Why production occurs in separate location is often determined by
Internalization occurs because it is more profitable to conduct transactions and production within a single organization than in separate organizations. Reasons for this include:
= OLI paradigm (Dunning)
Phases: home production; export; export of capital; foreign production.
Main specificities ofstrategic alliances: