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Explaining changing patterns of international production: In defence of the electric theory
... to build the conception of foreign investors' satisfaction and loyalty and the factors affecting them, the author based on some theoretical frameworks about determinants of FDi such as Dunning's eclectic theory (Dunning, 1979), theory of investment environment, theory of national competitive Advantage of industries (porter, 1985). ...
... investors can easily access local information and documents seR6 the coordination among state management agencies is harmonious and fast investment industry advantage (aDV) aDV1 the main materials for production and trading are available and abundant Ha et al. (2015) aDV 2 Local is the main consumption market aDV 3 near business parties (main distributors or suppliers) aDV 4 the local support industry thrives Competitive input cost (Cos) Cos1 the locality has a great advantage in terms of labor costs Dunning (1997), a. n. nguyen and nguyen (2007) Cos2 ...
... this result resonates with research conducted by Begg et al. (2007), p. h. Dinh (2012, Dunning (1997), and Kotler et al. (2002). nonetheless, studies are contradicting this, suggesting that human resources might not directly impact investor satisfaction. ...
The study aims to examine the factors affecting the satisfaction and loyalty of foreign investors in a locality through ‘hard’ infrastructure and ‘soft’ infrastructure factors. The author used Cronbach’s Alpha, EFA, and SEM to analyze primary data and test the hypothesis. The findings indicate that factors such as Infrastructure, Human Resources, Investment Policy, Living Environment, Local Brand, Quality of Public Services, and Local Advantages impact FDI investors’ satisfaction. Meanwhile, Competitive input costs are the only factor affecting the loyalty of FDI investors which differs from previous research. These results serve as a crucial foundation for Vietnamese municipalities to implement various strategies to enhance satisfaction and bolster the loyalty of FDI investors, ultimately amplifying the draw of foreign direct investment into the area.
... Since the introduction of Dunning's OLI framework (Dunning, 1979), a host of empirical studies have been undertaken to investigate the drivers of FDI, both for developed and developing countries, trying to account not only for economic but also for political factors, and focusing on a variety of countries, methods, periods and variables. Below, we briefly review the available evidence for some key determinants with a focus on NMS and Balkan countries. ...
... To ensure sufficient numerosity in our empirical analysis, we aggregate investments in three functional categories: Manufacturing, Services, and Resource-related activities. These categories may be viewed to broadly reflect the underlying heterogeneity in motives between efficiency-seeking, market-seeking and resource-seeking investments, respectively, following Dunning's taxonomy (Dunning, 1979) ...
... Within his eclectic paradigm,Dunning (1979) classifies FDI in three main categories: market-seeking, to gain access to large local and regional markets and distribution networks; efficiency-seeking, aiming to improve the competitive position in international markets by rationalizing the value chain through vertical FDI in lower-cost locations; resource-seeking, when the foreign firm's main intention is to exploit natural resources available in the destination area, such as raw materials and energy. A fourth category, strategic asset-seeking, may be seen as a subset of resource-seeking FDI in search of specific assets to promote their strategic objectives, such as brands, marketing and distribution networks, specialised human capital or R&D capacity. ...
Foreign Direct Investments (FDI) have heterogeneously increased across Balkan countries over the last three decades. We investigate one likely source of this heterogeneity by using information on 9185 greenfield FDI locating in 8 Balkan countries from 84 origin countries worldwide over the 2003–2019 period. Notably, we investigate the role of the accession to the European Union in determining the probability that an FDI will locate in one specific Balkan country. In doing so, we control for standard FDI determinants such as market size, openness to trade, wages and governance as well as different forms of co-location between the new investment and those previously located in the same host country. We stratify our sample in terms of FDI origin countries, distinguishing between EU and non-EU investors. Overall, EU accession appears to be associated with positive gains in FDI. This result appears to be driven by European investors, while non-EU MNEs do not seem to be affected by the EU membership of potential destinations. To our knowledge, this is the first study to address the issue of FDI determinants in Balkan countries including such a comprehensive set of regressors and exploring country-of-origin heterogeneity at the investment level, while dealing with the hot topic of the EU accessionKeywordsForeign direct investmentLocation choiceBalkansEU accessionConditional logit
... Foreign firms face additional costs relative to local firms arising from unfamiliarity with the host market, cultural and institutional distance, political and economic differences, and discriminatory policies and practices ( Hymer 1976 ;Zaheer 1995 ). Firms should find FDI attractive if they possess sufficient organizational and managerial capabilities or firm-specific resources that will help to offset such costs and if they are able to maintain internal control across operations to minimize the information and transaction costs associated with operating in imperfect markets ( Buckley and Casson 1976 ;Hennart 1982 ;Nelson 1991 ). Dunning (1977Dunning ( , 1979) builds on the above perspectives to develop the eclectic paradigm, which emphasizes ownership, location, and internalization advantages that could help overcome the liability of foreignness and make it cost-effective for firms to undertake FDI. Ownership advantages refer to a firm's control of ownership rights and proprietary information that may enhance its competitiveness over foreign rivals. ...
... Firms should find FDI attractive if they possess sufficient organizational and managerial capabilities or firm-specific resources that will help to offset such costs and if they are able to maintain internal control across operations to minimize the information and transaction costs associated with operating in imperfect markets ( Buckley and Casson 1976 ;Hennart 1982 ;Nelson 1991 ). Dunning (1977Dunning ( , 1979) builds on the above perspectives to develop the eclectic paradigm, which emphasizes ownership, location, and internalization advantages that could help overcome the liability of foreignness and make it cost-effective for firms to undertake FDI. Ownership advantages refer to a firm's control of ownership rights and proprietary information that may enhance its competitiveness over foreign rivals. ...
This paper leverages firm-level data to examine the impact of the US–China trade war on the greenfield investment of Chinese investors. Our research yields a few interesting findings. Importantly, our longitudinal analysis of Chinese greenfield investment projects yields evidence that the tariffs have dampened overall Chinese investment. Further analyses for different world regions indicate that while the tariffs have generally had a chilling effect on Chinese investment in most world regions, they may have prompted Chinese investors to engage in “tariff-jumping” in the United States. Our analysis further shows that the trade war may have incentivized Chinese investors to increasingly invest in countries with good political ties with Beijing, presumably as a buffer against potential downturns in bilateral relations. It may also have contributed, at least in part, to a reduced willingness by Chinese state-owned enterprises to engage in overseas investment. However, we found no evidence that the tariffs have led to a perceptible shift in China's investment flows toward BRI countries. Overall, these findings help to illuminate the extent to which policies of “decoupling” may have induced shifts in Chinese investors’ investment patterns, at least in the short-run.
... The theoretical underpinnings of Foreign Direct Investment (FDI) determinants have undergone significant evolution over the years, with various frameworks and models emerging to explain the complex decisionmaking processes of multinational enterprises. At the forefront of this theoretical landscape stands Dunning's (1979) eclectic paradigm, also known as the OLI framework. This seminal work posits that firms engage in FDI when they possess specific advantages in Ownership, Location, and Internalization. ...
... The present study aims to address this gap by providing a comprehensive analysis of recent trends, policy initiatives, and sector-specific dynamics in Arab-Malaysian FDI flows. By building upon the theoretical foundations laid by scholars like Dunning (1979) and incorporating insights from more recent works such as Blonigen and Piger (2014), this research seeks to offer a nuanced understanding of the complex interplay between macroeconomic factors, policy environments, and cultural considerations that shape FDI decisions in this unique context. Through this analysis, the study aspires to contribute to the growing body of literature on South-South economic cooperation and provide valuable insights for policymakers, investors, and researchers alike. ...
This study examines the macroeconomic factors and policy dynamics influencing Foreign Direct Investment (FDI) flows from Arab countries to Malaysia during the period 2018-2023. Employing a qualitative research design, the study utilizes semi-structured interviews with key stakeholders, analysis of policy documents, and examination of economic data to provide a comprehensive understanding of this evolving economic relationship. The research reveals that Malaysia's economic resilience, robust GDP growth, and effective fiscal policies have been instrumental in attracting Arab FDI, despite global challenges such as the COVID-19 pandemic. Strategic policy initiatives, including targeted FDI incentives and bilateral trade agreements, have played a crucial role in facilitating investment flows. The study identifies key sectors attracting Arab investment, including real estate, Islamic banking and finance, oil and gas, and tourism. Malaysia's position as a global hub for Islamic financial services and halal industries emerges as a significant factor in its appeal to Arab investors. However, the research also highlights persistent challenges, such as regulatory hurdles, cultural and language barriers, and increasing regional competition. The study concludes that while Malaysia has successfully positioned itself as an attractive destination for Arab FDI, continued policy refinement and focus on high-value, knowledge-intensive sectors are necessary to maintain this position. The findings contribute to the growing body of literature on South-South economic cooperation and provide valuable insights for policymakers, investors, and researchers. Future research directions, including the need for quantitative analysis and comparative studies with other Southeast Asian countries, are suggested to further enhance understanding of these complex investment dynamics.
... The Institutional FDI Fitness Theory and the Eclectic Theory argue that Governance, financial development (Wilhelms & Witter, 1998) and globalisation (Dunning, 1979) are prominent factors for FDI Inflows. Hence, this study aimed to examine four important factors, namely quality of governance, political globalisation, social globalisation and financial development and its effects on FDI Inflows among Upper Middle-Income countries and Lower Middle-Income Countries. ...
... The Institutional FDI Fitness Theory posits that FDI is influenced by these elements. Next, this study extended the Institutional FDI Fitness Theory by adding decomposed globalisation elements, which is political globalisation and social globalisation, which is also in line with the Eclectic Theory (Dunning, 1979). ...
... In order to achieve this, we used an evolutionary approach as the overarching method of reasoning, as did J. Cantwell et al. (2010) who examined the coevolution of MNE activities and institutions. To illustrate the fundamental shift in thinking about GCs and MNEs, we started with the groundbreaking works of Hall (1966), Sassen (1991Sassen ( , 1994Sassen ( , 2001 and Dunning (1979Dunning ( , 1981aDunning ( , 1988aDunning ( , 1995Dunning ( , 2000Dunning ( , 2001Dunning & Lundan, 2008) and then benefited from later contributions by other authors. We also supplemented the conceptual and research works with information from reports of recognised research centres (e.g., the Globalisation and World Cities Research Network at Loughborough University) and international institutions (e.g., the United Nations Conference on Trade and Development). ...
... MNEs are, by definition, companies that do business in different markets, often in different parts of the world. As explained by the OLI paradigm (Dunning, 1979(Dunning, , 1981a(Dunning, , 1988a(Dunning, , 1995(Dunning, , 2000(Dunning, , 2001Dunning & Lundan, 2008: 95-109), competing in these markets with domestic companies as well as with other MNEs is possible thanks to the ownership-specific "O" advantages, which allow the operating costs of a distant economic, social and cultural environment to be overcome. These advantages arise from the exclusive possession of or privileged access to tangible and intangible assets (e.g., production technologies or processes, better sources of raw materials, brand, expertise, product differentiation, management and marketing skills) that MNEs may transfer to their operations in foreign markets (Izumi et al., 2017: 276-277). ...
Global Cities (GCs) and Multinational Enterprises (MNEs) belong to a group of entities that shape the modern world economy in the most distinct way. So far, both of them have been given a lot of attention in the literature, but few studies have been written linking these two important threads of deliberation remaining the aspects of relationships between GCs and MNEs relatively unexplored. This is surprising as GCs and MNEs are not sole players but symbionts in the world economy. Hence, the intention of the authors – and the aim of this paper – is to overview these issues and connect GC and MNE threads in order to provide a platform for future research studies. By adopting an evolutionary approach and integrating the perspectives of economic geography, urban studies and international business, the paper identifies several research areas that may be fundamental to the GC/MNE discussion. They have been grouped in the following five thematic categories: global trends, international and country-specific factors; heterogeneity and transformation of global cities; MNE internationalization motivations and different market entry modes; global cities and global value chains; outcomes of MNE activity.
... There are three basic conditions that must be met for FDI to take place as postulated by Dunning [11]. (i) a firm has net competitive exclusive advantages in relation to other countries in serving specific markets. ...
... If not, Dunning stated that domestic markets would be served solely by domestic production and foreign markets by exports. These three conditions explain the rationale for a firm to engage in FDI and international production activities if it has more ownership advantages, the better the incentive it holds to internalise them and the more it finds it more profitable to exploit them beyond its geographical boundaries [11]. This implies that these conditions are interrelated and must be satisfied simultaneously, and if not, FDI activities are more likely to change direction to divestment. ...
Foreign direct divestment can occur for either external or internal factors. The determinants of FDI are also the same determinants for FDD. FDD might lead to numerous negative economic factors such as a decline in economic development, reduction in employment and might also cripple the facilitation in technology transfers. In this paper, the FDD concept in the Sub-Saharan African countries was investigated using annual data spanning from 1998 to 2018. The panel autoregressive distributive lag was used to develop the FDD model. The findings of the panel ARDL long run equation revealed that lending rates and urbanisation have a negative and significant influence on foreign direct investment. Further, the findings revealed an insignificant influence of real gross domestic product per capita on FDI. Finally, trade openness showed a positive significant impact on foreign direct investment. We recommend policies that increase FDI through the cost of borrowing since increasing this results in foreign direct divestment. Real gross domestic product per capita cannot be used for policy making purposes in the study. Trade openness makes a country more accessible on the world market and thus, policies that promote foreign trade such as exporting complex and sophisticated products, trade liberalisation, free trade agreements and open trade systems could help reduce the presence of foreign direct divestment in the selected countries. Finally, urbanisation deter foreign direct investment, therefore countries should invest more on infrastructure and reduce poverty in rural areas to transform them into urban areas to decrease urbanisation.
... The other model of international competitiveness is the OLI or eclectic paradigm (Dunning, 1979(Dunning, , 1988(Dunning, , 1996(Dunning, , 1998(Dunning, , 2001Nachum, 1999). This theoretical framework argues that firms or their subsidiaries can successfully compete in foreign markets only if they possess ownership, location and/or internalization advantages over their competitors. ...
... According to the eclectic paradigm, firms successfully compete in foreign markets only if they have ownership, internalization and/or location advantages (Dunning, 1979(Dunning, , 1988. In particular, ownership advantages such as brands are specific assets to the firm. ...
This research examined the firm level factors that contribute to competitiveness of international new ventures (INVs). Specifically, the study investigated the extent to which entrepreneurial and branding resources and capabilities contribute to competitiveness of INVs in Uganda.
... No distribúcia zahraničných investícií v krajine nie je ani zďaleka rovnomerná. Toky priamych zahraničných investícií odrážajú špeci昀椀cké charakteristiky a schopnosti hostiteľskej lokality (Dunning, 1979), čo vedie k rozdielnej kapacite lákať zahraničných investorov (Zheng, 2011;Nistor, 2012). Zahraniční investori so sebou prinášajú nielen nové pracovné príležitosti, ale aj nové vedomosti či schopnosti (Lloyd, 1996). ...
The aim of the publication is to network research, connect it with practice, formulate recommendations and priorities in regional policy and development, and thereby fulfill the mission of "Regional Development Now!" (RRT!).
The publication focuses on thematic areas such as public administration, territorial division, public investments, cross-border cooperation, sustainable development, green energy, and the local economy. This year, additional topics such as education, skills development, and housing have been included. Thematically, the publication continues its collaboration with the civic association Friends of the Earth-CEPA on the topic of green transformation within regional development.
In this regard, we would like to highlight contributions related to the preparation of the Social Climate Fund.
... The primary motivation for firms to internationalize is to access lower cost resources overseas (Buckley & Casson, 1976). In this context, firms that aim to expand abroad can benefit from factors such as lower labour wages, lower raw material costs, and lower transportation costs, resulting in higher returns (Dunning, 1979). However, firms may choose to expand into new markets to establish a monopoly by utilising unique assets, particularly intangible assets, through foreign direct investment (FDI). ...
Numerous studies have been conducted to examine the internationalization-firm performance relationship. However, a definitive consensus has not yet emerged in the literature due to varying findings. Therefore, this study aims to examine the relationship between internationalization and firm performance through meta-analysis. The study analyzed data from 170 samples and 334,855 Multinational Companies (MNCs) obtained from SSCI and Scopus databases for published studies, and doctoral theses for unpublished studies, using the random effects model. The analysis revealed a significant, positive, and small combined effect size between internationalization and firm performance. The study found that financial leverage, sector, time period, research and development (R&D) intensity, home country effects, and firm age were statistically significant as subgroup variables. However, unrelated product diversification, firm size, and advertising intensity were not statistically significant. It has been determined that the subgroup variables with a higher combined effect size are developed country MNCs, MNCs in the service sector, older MNCs, and MNCs with high financial leverage. It is also found that the combined effect size for MNCs is lower than before 2003.
... Dunning (1988) and Kogut (1985) argue that firms carry out international operations if there are transaction gains likely to result from the common governance of activities in different locations, including enhanced arbitrage and leverage opportunities, market hedging, better coordination of financial decisions, multiple-sourcing strategy, the possibility of gains through transfer price manipulation, leads and lags in payments, and so on. There are also long-term factors which will influence whether firms invest in foreign countries such as the size of the domestic market, geographical distance between the home country and its market, psychic distance, and the industrial structure of investment (Dunning 1979). The 'internalisation theory' of Buckley and Casson (2009) posits that firms will internalise the market when the expected benefits of doing so outweigh the expected costs, and that this will be influenced by exogenous factors such as policy changes and technological improvements, which may thus encourage the globalisation of firms. 2 There are similarities between the Eclectic Theory, the Transaction Cost Theory and the Internalisation Theory in explaining the root cause of the internationalisation of firms, where the focus has been predominantly on lowering transaction costs or achieving cost efficiency and to protect and utilise firm specific advantages. ...
... Finally, there should also be further investigation of the potential significance of ecosystems for existing IB theories (Cha, 2020), for example because the theory of internalization (Buckley & Casson, 1976) now needs to be linked with network theory (Buckley, 2020;Nambisan & Luo, 2021). Instead of the ownership, localization and internalization (OLI) advantages in the eclectic theory of Dunning (1979), "ecosystem-specific advantages" are now possible (Li et al., 2019;Nambisan et al., 2019;Nambisan & Luo, 2021), as described, for example, by Luo (2021) with open resource, linkage and integration (new OLI) advantages for digital globalization. ...
Due to risks in the supply chain and the need for sustainability, among other things, concepts of de-internationalization are increasingly being considered, while at the same time the potential of growing markets motivates MNEs to continue investing in international operations despite the often large distances involved. This can lead to paradoxical tensions in companies between motives for scaling back and expanding the international footprint, particularly in the capital-intensive automotive industry. To mediate these tensions in the sense of paradox theory from a “both-and” approach, a link is made to transaction ecosystems based on digital platforms that enable the exchange of complementary resources across national borders with reduced transaction costs. Hypotheses are theoretically derived and then empirically tested using structural equation modeling in a quantitative study of 286 internationally active automotive companies. Although the results of the study confirm the suitability of such digital platforms for mitigating paradoxical tensions in international business, they also show that the performance impact of these ecosystems for companies is still low and needs to be further improved through the optimized use of various platform effects.
... We can come across similar conclusions in the studies conducted by Wagner (2006) and Wakasugi & Tanaka (2014), who demonstrate that exporting firms are more productive than firms operating only in the domestic market, and international corporations are more productive than firms engaged in exports. The above conclusion is consistent with the concept of Dunning (1979), who argued that firms engage in FDI when they possess some ownership advantages (e.g., the form of access to capital flows for investment, new technologies, better marketing techniques and management practices) which help them to compete in foreign markets against established domestic counterparts. Firms with FDI know-how to use these assets, facilitating higher productivity (Griffith et al., 2002). ...
A specific cognitive gap that inspired us was the questionable evaluation of active internationalisation in emerging economies, including those in Central Europe. This is because the growth of FDI there often contradicts the logic one uses when analysing investment from developed countries. For this reason, some researchers believe that to interpret FDI made by companies from emerging economies they would need to create a specific theory of international business; others argue that the current theoretical framework is sufficient for this purpose, and still, others believe that an in-depth understanding of this expansion should provide material to enrich and extend existing theories of internationalisation.
... Another widely adopted paradigm that has been used to explain the internationalisation behaviour of firms is the Eclectic Paradigm (Dunning, 1977(Dunning, , 1979(Dunning, , 1988. The eclectic paradigm, also referred to as the OLI framework, implies that firms internationalise when they have ownership, location, and internalisation advantages. ...
Recent advances in technology (e.g., the Internet of Things, Augmented Reality, Virtual Reality, Cloud Services, Artificial Intelligence, and Blockchain), the shift towards digital products, and the increased use of digitalisation by firms have enhanced consumers’ experience and transformed how companies operate, create products/services, and offer value to multiple stakeholders on a global scale. These technological innovations have led to the phenomenon known as the Metaverse. The Metaverse does not refer to any one type of technology but is a broad (and often speculative) shift in how we interact with different technologies in the same space. In the context of International Business (IB), the recent emergence of Metaverse appears to make geographical, sectoral, and operational barriers less relevant, raising complex questions about how current IB theories can explain the world-spanning, sectorally fluid, and centrifugal behaviour of firms in the era of digital globalisation. In this paper, we obtain a critical understanding of the important opportunities and challenges that the Metaverse and the fluidity of digital technologies bring to the IB field. Specifically, we discuss how traditional theories can be effectively utilised to explain firms’ internationalisation, and adapted to reflect the new technological era. We propose a framework for new approaches to IB research to help advance research on Metaverse and IB, which can provide important opportunities for future work in this field.
... Valor patrimonial del producto Dunning (1979) Perspectiva de la internacionalización basada en los recursos (nivel de empresa) ...
Previous studies have shown that export promotion programs boost firms’ cross-border activities. However, despite the remarkable growth of agroindustries with an international focus, there is still a gap in the literature on these programs as far as this business sector is concerned. Thus, this study is designed to elucidate the contribution of export promotion programs to the internationalization of the food and beverage agroindustry in Tabasco. A qualitative approach with a multiple case study design was used to analyze the experiences of agroindustry executives and export promotion institution officials on the diversity of export support. The study involved five agroindustries and two export promotion institutions. The data were collected through semi-structured interviews and interpreted with MXQDA, using the thematic analysis technique. In addition to facing difficulties in obtaining financial resources for their international activities, agroindustries showed a high degree of knowledge and use of export promotion programs in the early stages of exporting. However, over time, these companies realized that these programs were expensive, not very agile, lacked specificity, and did not meet their needs. Therefore, they decided to carry out their international operations with their own funds, thus reducing their dependence on the government. The study provides novel information on the role of export promotion programs in the growth of agroindustries in the international market. Its findings not only help to improve the structure of these programs, but also broaden knowledge in this field.
... La teoría más completa quizá constituye la de Dunning (1979), la que se cataloga como teoría de consenso. Con su teoría ecléctica reúne "dentro de un sistema las aportaciones de los teóricos de la organización industrial, la teoría de los costes de transacción y las teorías de localización y el comercio internacional" (Galván Sánchez, 2003, p.99). ...
Esta investigación presenta información sobre cómo las empresas guayaquileñas, especializadas en el procesamiento, empaquetado y comercialización de conservas de pescado, lograron internacionalizar sus marcas en los países miembros de la Comunidad Andina (CAN). Se hace preciso conocer: ¿Cuáles han sido los elementos propiciadores en la internacionalización de sus marcas? y si ¿Existe alguna relación entre los procesos aplicados y la internacionalización? En este artículo se reconocen y cuantifican los procesos aplicados en la introducción de sus productos con y sin marca en la CAN, las formas de acceso, manejo de la marca, influencias para internacionalizar, estrategias de promoción y publicidad empleada, así como los factores internos y externos que motivaron la exportación.
... Literature review OFDI motives and influencing factors. Dunning (1979) advocated analyzing the purpose and conditions of OFDI and the ability of OFDI together; based on adopting Heimer's monopoly advantage theory and Buckley's and Carson's internalization theories, he introduced the theory of location advantage. After synthesizing the theories, Dunning created the compromise method and framework, forming the compromise theory of international production, which explains the motivation of OFDI. ...
The Belt and Road Initiative (BRI) provides a new opportunity for the continued deepening of economic and trade cooperation between China and countries along the BRI route. However, different business environments among countries have led to the problem of a low and uneven distribution of China’s overall trade and investment efficiency in the countries along the route. Using the stochastic frontier gravity model, this study evaluates the efficiency of China’s outward foreign direct investment (OFDI) based on the data of 47 countries along the Belt and Road route from 2013 to 2019. The empirical results indicate that the efficiency level of China’s OFDI in countries located along the Belt and Road route is 43.39%, which suggests a regional imbalance. In terms of business environment factors, regulatory governance, civic discourse, government accountability, and regulatory quality in host countries have a positive impact on China’s OFDI. The positive effects of the BRI have enabled Chinese enterprises to better face factors such as political instability, corruption and imperfections in the legal system when investing abroad. The findings and suggestions could help the governments and enterprises of the countries along the route improve the business environment in a more targeted manner, enhance the space for economic and trade cooperation, and promote the common development of the countries along the route.
... Dunning's Eclectic Theory (Dunning, 1977;Dunning, 1979) focuses on O-L-I: Ownership Specific Advantage (e.g., technology), Location Specific Advantage (e.g., foreign political factors), and Internalization Advantage (e.g., operating abroad). It sets three conditions for FDI: firms must have ownership advantages, using them internally should be more profitable than selling or leasing, and combining these advantages with foreign resources should yield higher profits than exclusive exports. ...
In this research, we aim to highlight the impact of geopolitical risks and political stability on investment flows directed towards 10 high-risky countries in the relevant database of Caldara and Icaivello (2018) for the period from 2000 to 2022 with yearly data. On that note, we employed Durbin-Hausman panel cointegration test to check long run relationship. Than, we estimate co-integration parameters (coefficients) employing CS-ARDL method to avoid estimation problem that arise from cross-section dependency and slope homogeneity. The results reveal that geopolitical risks have negative effect on Foreign Direct Investment (FDI) for both short and long term. The findings also prompt us to conclude that political stability in the host country has significant impact on inward FDI in the long run. Cross-section dependency and delta tests indicate that geopolitical risk generates heterogeneous effect on host countries. In the last section, robustness check with alternative estimators and Granger non-causality validates the main results at conventional confidence level. To this end, policy makers may consider strengthening international institutions and organizations, giving importance to peaceful initiatives, multilateral agreements (commercial or economic), and diplomatic negotiations, as significant policy tools to increase investment inflows by enhancing stability, transparency, and predictability in governance.
... Thus, the case of Maersk in Vietnam's early export boom provides a unique opportunity to assess the role of shipping and logistics FDI in developing country export performance, FDI being the defining characteristic of a MNC (Dunning 1979). ...
This paper assesses the role shipping and logistics foreign direct investment (FDI) plays in developing country export performance, exemplified by the case of the large multinational corporation (MNC) Maersk’s investments in Vietnam. The paper aims to generate a deeper understanding of how the introduction of advanced shipping and logistics services by a foreign investor contributed to export growth. The paper is based on a longitudinal case study of Maersk in Vietnam employing more than 100 interviews from Maersk, Maersk’s clients, subcontractors, and industry experts conducted between 2003 and 2016, complemented and validated by primary commercial data from Maersk, and secondary industry- and market data. The paper finds that during that period, Maersk impacted Vietnam’s export performance through five mechanisms: 1. Building infrastructure; 2. Creating connectivity and market access; 3. Reducing transaction and logistics costs; 4. Bringing buyers and sellers together; and 5. Upgrading export capabilities. While transport and logistics MNCs’ role in building infrastructure and reducing trade costs is described in the literature, the paper provides novel insights into their role as intermediaries in trade that provide value chain access and transparency, reduce transaction costs for buyers and producers, and upgrade export capabilities. The paper suggests that Maersk’s contributions to Vietnam’s export growth from 2003 to 2016 in part can be attributed to its unique competitive advantages originating from its superior organization, technology, and capital intensity. The paper contributes to the literature by deepening it’s understanding of the mechanisms through which large shipping and logistics MNCs influence developing countries’ export-led industrialization; by proving novel insights into the role of Maersk in Vietnam’s development path; and by providing and validating an analytical framework for analyzing shipping and logistics MNCs’ role in export led development that may inspire future research
... This means that some incentives make firms indulge in FDI, whereas the lack of those incentives leads to divestment. Dunning's (1979) FDI theory is used to demonstrate this proposition. This theory states that a firm pursues FDI under three simultaneous conditions. ...
Purpose
This paper aims to investigate the drivers of foreign direct divestment (FDD), how it relates to foreign direct investment (FDI) flows and stocks and its implications for developing countries. While divestment occurs for various reasons, it can be explained by reversing the propositions implied by FDI theories.
Design/methodology/approach
The authors combine FDI data and FDI theories to provide theoretical explanations for FDD and what it means for developing countries. FDI stock and flow data are used to derive inferences on trends in FDD and examine the implications of FDI theories on FDD.
Findings
Changes in the modes of global production and the rise of COVID-19 have reinforced the trend of stagnant or diminishing FDI flows observed since the global financial crisis, with implications for FDD. The authors demonstrate how the various FDI theories can be used to explain FDD, except for the currency areas hypothesis. By reviewing the costs and benefits of FDI, it is concluded that shrinking FDI flows and stocks may not be as detrimental for developing economies as it is typically portrayed.
Originality/value
The paper uses two original approaches to measure and explain the motives for FDD. The first is a reassessment of FDI theories in a way that makes them valid theories for FDD. The second original approach is to interpret data on FDI flows and stocks to imply the trends governing FDD, which is useful, as data on foreign divestment are not available on a country or regional basis.
... One of the key issues in the literature on innovation and international business is the extent to which the multinational enterprise (MNE) is an effective vehicle for international technology and knowledge transfer. This process is central to the dominant paradigm of the multinational enterprise (Dunning 1979;Buckley and Casson 1976). The paradigm essentially relies on the observation that the single most important determinant of a firm's decision to engage in foreign direct investment (FDI) is its ability to exploit its 'ownership advantages' or firm-specific assets in foreign environments where other options, such as licensing, are less attractive. ...
... A lack of infrastructural facilities can contribute to an increase in operating costs (Kaur et al., 2016). Moreover, infrastructural facilities provide an environment conducive to foreign firms (Dunning, 1979). ...
... There have been various attempts in the applied literature to move from a conceptual understanding of FSAs or Dunning's ownership advantages, to an empirical measure. If one takes the most common understanding of this term of FSA then these are described as "knowledge" advantages (Rugman, 2010), while Dunning (1979) describes them as the set of firm-specific intangible assets. There have been various attempts to capture this empirically, dating back for example to Driffield and Munday (2000), Kotha et al. (2001), and more recently Contractor et al. (2016) in the international strategy literature, and to Helpman et al. (2004) in the economics literature. ...
The purpose of this study is to explore the differential gains from internationalization for different forms of corporate governance. In particular, we seek to move from the question concerning whether firms are able to generate differential gains from internationalization, to the question of why. Our focus is on ownership structure, and the differential rates at which business group affiliated firms and standalone firms gain from internationalization. Using a unique data set of some 356 standalone and business group affiliated firms, we show that while the marginal gains from internationalization may be greater for standalone firms, business group firms are better able to exploit firm-specific assets, leveraging these into higher returns to internationalization.
... According to Helpman (1984) and Grossman & Helpman (1991), these types of models' commerce and multinational formation are both influenced by disparities in relative factor endowments across nations as well as differences in factor intensities and sectoral specialization. Dunning (1979) utilizes the OLI paradigm to explain why a corporation would choose FDI over EXP when there are ownership benefits, geographical benefits (access to a sizable local market or manufacturing resources), and benefits to internalizing market access activities. In this situation, FDI and trade can serve as substitutes or complements, depending on which of the benefits was the deciding factor in the investment choice. ...
This study employed autoregressive distributed lag model (ARDL) approach to investigate how exports and foreign direct investment (FDI) are related in Pakistan for the period spanning from 1974 to 2019. For cointegration analysis, we used bounds test. The findings of the cointegration test indicated that the variables have a long-term cointegration relationship. According to estimated results, the relationship between the two variables is negligible over the long-run, whereas FDI has a positive influence on exports in the short-run. Moreover, the estimated error correction term is significant with the expected sign. It is concluded that FDI inflows are advantageous for improving manufacturing processes, which would eventually lead to high-quality exports and economic progress of Pakistan. Policymakers are required to make efforts to removing all hurdles in Pakistan's economic progress.
... According to Dunning (1979), the product cycle hypothesis is only a partial explanation. ...
FDI is much sought after in conflict-stricken countries such as Nepal as it can play a crucial role in the development process. However, the process of attracting and promoting FDI is complex, in particular as most developing countries, including Nepal, are competing for similar types of FDI. Although a number of efforts have been made in the past to boost FDI flows to the country, they have not had any striking impact. The country has not been able to draw on the potential technological and other contributions that FDI can make to the process of development. This underlines the need for effective policy interventions with a view to maximizing the benefits of FDI for Nepal's development in an open environment. Nepal also needs policy framework to enhance national and regional infrastructure, in areas such as transport, energy and communications services, and to generate domestic employment and skills transfer. The main policy conclusion that can be drawn from this paper is that the economic benefits of FDI are real, but they do not accrue automatically. To reap the maximum benefits, a healthy enabling environment for business is paramount, which encourages domestic as well as foreign investment, provides incentives for innovation and improvements of skills and contributes to a competitive investment climate.
... In a similar vein, other authors have shown the special role of linguistic and cultural proximity in company internationalization processes (Silva, 2005). • Firm context: According to Dunning (1979), the eclectic paradigm resulted from his dissatisfaction with the existing theory of international production: the Hymer--Kindleberger approach, the product-cycle theory, and the internalization theory. Henceforth, Dunning proposed an alternative line of development seeking to integrate the existing theories into a general and 'eclectic' model. ...
O Plano Real permitiu o aumento do número das empresas brasileiras que investem no exterior, especialmente a partir do ano 2000. A EMBRAER, uma das três maiores construtoras de aeronaves do mundo, é um exemplo disso. Este trabalho tem como objetivo analisar as motivações para investir da Embraer/OGMA em Portugal, a segunda localização em importância fora do Brasil, através de uma entrevista com a diretoria local da empresa em 2011. Primeiro, abordar-se-á a situação atual da indústria aeronáutica. Em segundo lugar, o enquadramento teórico sobre o IDE. Em terceiro lugar, descrever-se-á a expansão global da EMBRAER. Logo após, concentraremos a nossa atenção nas motivações da EMBRAER para investir em Portugal. A concluir, refletir-se-á sobre o impacto desses investimentos na economia através, por exemplo, da formação de clusters.
... (b) The ability to use these advantages internally, rather than giving foreign firms the rights to use these advantages through licensing, management contracts, and franchise. (c) Location advantages that are immobile determine location profitability in a host country relative to that of the home country (Dunning 1979(Dunning , 1981. ...
The paper aims to explore the relationship between foreign direct investment in Egypt, as a dependent variable, and selected economic and institutional determinants for the period (1996-2018). The work attempts to the gap created by previous empirical literature that failed to focus on critical institutional determinants of FDI in developing countries, especially governance determinants, The study used the autoregressive distributed lag model (ARDL) to test the cointegration relationship between FDI and its determinants. Besides, the error correction model (ECM) was used to explore the sgort0run relationship. In light of applying the ARDL approach, the study concluded that, while both market size and regulatory quality stimulated FDI, the latter has been negatively affected by the real exchange rate and government effectiveness. moreover, the study revealed that in the short-run, both regulatory quality and control of corruption induced FDI in Egypt. These findings shed light on the crucial role that institutional factors can play in creating a more favorable FDI climate in Egypt.
... Dunning (1988) and Kogut (1985) argue that firms carry out international operations if there are transaction gains likely to result from the common governance of activities in different locations, including enhanced arbitrage and leverage opportunities, market hedging, better coordination of financial decisions, multiple-sourcing strategy, the possibility of gains through transfer price manipulation, leads and lags in payments, and so on. There are also long-term factors which will influence whether firms invest in foreign countries such as the size of the domestic market, geographical distance between the home country and its market, psychic distance, and the industrial structure of investment (Dunning 1979). The 'internalisation theory' of Buckley and Casson (2009) posits that firms will internalise the market when the expected benefits of doing so outweigh the expected costs, and that this will be influenced by exogenous factors such as policy changes and technological improvements, which may thus encourage the globalisation of firms. 2 There are similarities between the Eclectic Theory, the Transaction Cost Theory and the Internalisation Theory in explaining the root cause of the internationalisation of firms, where the focus has been predominantly on lowering transaction costs or achieving cost efficiency and to protect and utilise firm specific advantages. ...
Penrose analysed why some firms succeed in growing – what the factors are that enable growth, and the ways in which success can breed success, with enhanced capabilities enabling growing market share (or sales), and with increased revenues and profitability enabling those capabilities to be further developed. There is a separate question as to why firms expand their operations internationally. In this paper, we analyse a sector that in Edith Penrose’s day operated almost exclusively domestically, namely the ‘consulting engineering’ sector. We consider why firms in this sector are now increasingly operating internationally. In doing so, we consider whether the factors identified – by Penrose and others – as causing firms to grow are also relevant to the expansion of these firms overseas. Our findings support Penrose’s Resource-based Theory, which argues that unique strategic resources that are inimitable and non-substitutable can provide firms with competitive advantages. Internationalisation provides consulting engineering firms with the opportunities to explore and obtain different kinds of expertise and resources from other regions. With a larger pool of expertise to draw from, firms can develop their firm-specific strategic assets and technical advantages.
... In the literature, researchers studied the Macdougall and Kemp Approach (MacDougall, 1960;Kemp, 1964), the Catching-up Product Cycle (Kaname, 1962), the Product Life Cycle (Vernon, 1966), the Optimum Taxation Approach (Watanabe, 1966), the Product and Factor Market Imperfections (Caves, 1971), the Kojima's Approach (Kojima, 1973), the Monopolistic Advantage Theory (Hymer, 1976), the Internalization Theory (Buckley & Casson, 1976) and so on. Among these theories, Dunning's OLI paradigm (Dunning, 1979;Dunning, 1980) is the most popular as it combines ownership, location, and internalisation advantages of choosing FDI by multi-national enterprises. However, no single theory can be applied solely to measure the determinants of FDI. ...
This study examines the determinants of foreign direct investment (FDI) in two South Asian neighboring countries: Bangladesh and India. These two developing countries are trying to attract FDI for accelerating economic growth. However, the inflow of FDI in Bangladesh in comparison with India is very low. Therefore, this paper investigates, analyses, and compares the determinants of FDI between these two economies. Hence, relevant theories and empirical evidence on the determinants of FDI are reviewed first. Next, the research uses secondary data collected from different sources and then employs trend analysis, descriptive statistics, correlation, and regression to examine the variables affecting FDI, such as market size, infrastructure, exchange rate, trade openness, and economic risk. The result from the empirical investigation shows that only the market size of Bangladesh is positive and significant to attract FDI but other independent variables,such as exchange rate, GDP per capita, infrastructure, and trade openness are not significant. On the other hand, GDP per capita, large market size, infrastructure, and exchange rates are positive andsignificant for India as a recipient of more FDI than Bangladesh. Therefore, the government, policymakers, and business associations of Bangladesh are recommended to focus on developing infrastructure, stabilizing macro-economic policy, and reducing the barrier to make the Bangladeshi market more open to the global market so that FDI is encouraged and eventually economic growth of the country is accelerated.
... Many authors studied these questions, in particular those concerned with the internationalization of production systems. Coase (1937) In his famous book "The Nature of Firm" has distinguished between firm borders and market borders in the sense that a firm substitutes its borders for market borders when the cost of internal transactions is lower than market utilization costs (Horstman and Markusen 1992) It is to Dunning (1979Dunning ( , 1988aDunning ( , 1988b) that we owe the most convincing synthesis on this topic. To overcome the shortcomings of its approach named Ownership Location Internalization (OLI), he proposed a comprehensive explanation for the emergence of multinational firms. ...
In this paper we are interested in the phenomenon of internalization and/or globalization of firms. More precisely we examine a sample of 34 corporations operating in the telecommunications sector and rank them according to different indicators of internationalization. We propose a new indicator and compare it essentially with the Generalized Herfindhal one. In our point of view, this new indicator fits itself very well the global nature of the firm, the data and robustness.
... Similarly, it addresses differences between locations on the micro-level, mainly using the concept of the liability of foreignness (see Beugelsdijk and Mudambi, 2014, 9). In IB literature, the eclectic OLI Paradigm (with its dimension ownership (O), location (L) and internationalization (I)) developed by Dunning (1977Dunning ( , 1979Dunning ( , 1988Dunning ( , 2001 has been the fundamental concept for considering location (see Fuller, 2018, 118). In the OLI Paradigm, location (L) is one driver of firms' internationalization in general (see Cook and Pandit, 2018, 230-231). ...
The global selection of production sites is a very complex task of great strategic importance for Original Equipment Manufacturers (OEMs), not only to ensure their sustained competitiveness, but also due to the sizeable long-term investment associated with a production site. With this in mind, this work develops a process model with which OEMs can select the most appropriate production site for their specific production activity in practice. Based on a literature analysis, the process model is developed by determining all necessary preparation, by defining the properties of the selection process model, providing all necessary instructions for choosing and evaluating location factors, and by laying out the procedure of the selection process model. Moreover, the selection process model includes a discussion of location factors which are possibly relevant for OEMs when selecting a production site. This discussion contains a description and, if relevant, a macroeconomic analysis of each location factor, an explanation of their relevance for constructing and operating a production site, additional information for choosing relevant location factors, and information and instructions on evaluating them in the selection process model. To be successfully applicable, the selection process model is developed based on the assumption that the production site must not be selected in isolation, but as part of the global production network and supply chain of the OEM and, additionally, to advance the OEM’s related strategic goals. Furthermore, the selection process model is developed on the premise that a purely quantitative model cannot realistically solve an OEM’s complex selection of a production site, that the realistic analysis of the conditions at potential production sites requires evaluating the changes of these conditions over the planning horizon of the production site and that the future development of many of these conditions can only be assessed with uncertainty.
... The eclectic paradigm, also known as the OLI (ownership, location, internalization) model, is a useful framework in explaining competitive advantages experienced by multinational firms (Dunning, 1979). The ownership advantage refers to a firm's ownership rights of proprietary information, skills, and other internally available resources (e.g., branding, patents, management expertise, and innovation capabilities). ...
The international business literature, while extensive by now, has given scant attention to the direct comparison of the performance of advanced economy multinational enterprises (AMNEs) and emerging market multinational enterprises (EMNEs) in international markets. In particular, the question of how well these firms perform in each other's home markets is an intriguing one. In this study, we examine "market share" performance of AMNEs and EMNEs in each other's countries using a comprehensive, longitudinal dataset. Drawing from the eclectic paradigm , we contend that, in comparison, EMNEs perform better as they: i) develop non-traditional ownership advantages based on their learnings in their home markets, and ii) expand into advanced economy markets relying on non-traditional ownership advantages. Our findings show a declining performance of AMNEs operating in emerging markets over time, while EMNEs generally appear to benefit from increased market shares in advanced economy markets for the same period.
... Moreover, our study helps us in balancing the IB literature by emphasizing the role of non-economic factors, such as institutional environment, in determining FDI (Kang & Jiang, 2012). The majority of IB studies have predominantly focused on economic attractiveness of host locations, motivations of the investing firm, ownership advantages and the firm's ability to internalize production in the host country because traditional theoretical frameworks of FDInotably the OLI (Ownership-Location-Internalization) framework (Dunning, 1979(Dunning, , 1993, the DLE (Disintegration-Location-Externalization) framework (Kedia & Mukherjee, 2009), the Uppsala Model (Johanson & Vahlne, 1977; and Internalization Theory (Buckley & Casson, 1976)have continued to dominate empirical research (Munjal, 2014;. ...
This paper adopts and extends the theoretical lens of institutional imprinting to international business research. It analyses a secondary data set on Indian and Chinese foreign direct investment (FDI) flows to Africa, compiled for the period ranging from 2008 to 2018, to highlight the distinctiveness of Indian FDI. It argues that Indian FDI streams into better governed host countries with controlled corruption and high standards of accountability. This is in striking contrast with Chinese FDI, which is impervious to host country governance standards in its geopolitical quest for gaining economic supremacy in the region. India’s membership of the Commonwealth (CW) plays a vital role in the location and volume of its investments to Africa, whereas the Chinese Belt and Road Initiative (BRI) wields no influence on the location of its investment.
SMEs are vital for economic development, equitable income distribution, and economic democracy. The internationalisation of SMEs is becoming an increasingly important topic in global business. This study investigates SMEs’ internationalisation from a theoretical perspective. Beginning with the significance of SMEs and their participation in the EU's trade, we present a literature review on the determinants of SME internationalisation and the challenges SMEs encounter when entering international markets. We then present the mainstream theoretical framework of firms’ internationalisation, which is traditionally focused on large firms. In this respect we discuss some studies that have developed frameworks specifically targeted at SMEs. Furthermore, the study examines the crucial role of networks and clusters in facilitating SME internationalisation and the impact of EU support policies in promoting SME internationalization.
In recent years, India has not only signed numerous regional trade agreements (RTAs) but has also attracted a significant amount of foreign direct investment (FDI). In fact, India started signing FTAs with special investment clauses to secure higher FDI. India received substantial amount of FDI from its FTA partners. In the context of proliferating trade agreements combined with higher FDI inflows, it is crucial to examine the impact of RTAs in the attracting FDI in India. This study attempts to make an assessment of the volume of the FDI inflows in India from its FTA partners. This paper further aims to identify the key drivers of inward FDI to India for the period 1993–2023. In this study, we create a physical infrastructure index for India and employ a vector error correction model along with other macroeconomic variables for the analyses. We find that net FDI inflows, GDP per capita, forex reserves and inflation have a statistically significant long-run association. We also find that GDP per capita, forex reserves and the physical infrastructure index Granger cause net FDI inflows.
The purpose of this paper is to establish a policy framework for those responsible for maximising the opportunities of inward foreign direct investment (FDI). Our proposed framework intellectualises the need for dynamic capabilities at the country level (national and local) to sense and seize new opportunities from inward FDI, use this knowledge to mobilise resources and, over time, make changes to reconfigure the UK’s location-specific advantages in a post-Brexit marketplace. Using the backdrop of the UK’s decision to exit the European Union in May 2016 (Brexit) alongside other global challenges (the COVID-19-induced supply chain crisis, political unrest, wars, new trade deals), we explore the changing nature of FDI entering the UK. We explain why an adaptive investment promotion strategy means greater and more widespread benefits of inward FDI for the economy. Then, we propose a policy-oriented dynamic framework for how the benefits of FDI can be maximised during political upheaval. In our analysis and discussion, we highlight how changes in foreign firms’ FDI motives can alter the UK’s value proposition, and over time, the nature of a country’s specific advantages.
In the 2000s, China’s outward Foreign Direct Investment increased rapidly. A total of 135 Chinese enterprises were ranked in the Fortune Global 500 by 2023. However, many of them lack firm-specific advantages (FSAs) and are more dependent on country-specific advantages (CSAs); most of their sales are generated in China. This chapter analyses the extent to which Lenovo, a Chinese Information and Communication Technology enterprise, has evolved as a multinational enterprise (MNE) in terms of (i) FSAs, (ii) CSAs, (iii) export/overseas production ratio, and (iv) geographical footprints. Lenovo has reached a mature stage regarding FSAs, as it has enhanced its Research and Development capabilities and built a world-renowned brand. In terms of geographical footprints, Lenovo has reached a mature stage, as it has subsidiaries in many countries worldwide and significant sales overseas. However, Lenovo is still in its infancy regarding CSAs, as it was originally a state institution with strong government relations. In addition, Lenovo is still in its infancy with regard to its export/overseas production ratio, as a large number of personal computers are produced in Asia. Therefore, Lenovo is currently in the adolescent stage as an MNE.
The objective of the study is to identify the determinants of Foreign Direct Investment (FDI) inflows into India and to examine the effect of the global financial crisis on FDI inflows into India. Multiple linear regressions have been applied to identify the best model and the most significant factors that lead to higher FDI inflow into the Indian economy. Various models have been examined and the best fit is found using the logarithmic transformation of the lagged values of the independent variables. The empirical results obtained as shown in the paper are accepted on the basis of the F Statistic and the Adjusted R squared value. On further examination, it is clear that the dependent variable can be best predicted by Real Gross Domestic Product (GDP) and the dummy variable Global Financial Crisis. This is the best model from the ones we examined as the adjusted R squared value is the highest at 0.905. The estimated regression model for economic determinants of FDI for India is also given. The model can be further improved upon by using quarterly data.
Der Markteintritt und die Marktbearbeitung der Emerging Markets wird für Automobilhersteller zum Imperativ. Die reifen Automobilmärkte der Triade Westeuropa, USA und Japan befinden sich – unter anderem – aufgrund des geringen Wirtschaftswachstums in einer Sättigungsphase. Das Wachstum findet in den Wachstumsmärkten statt; allein 2010 stiegen die Neuwagenverkäufe in China um 34 Prozent, in Indien um 31 Prozent, in Indonesien um 51 Prozent et cetera. Die Liberalisierung des Welthandels fördert den globalen Markteintritt der Original Equipment Manufacturer (OEMs) in Emerging Markets. Daneben nimmt jedoch der Einsatz nicht-tarifärer Handelshemmnisse vor allem in Wachstumsmärkten zu – der sogenannte „neue Protektionismus“: Einfuhrkontingente und -quoten, Kompensationsvorschriften, Verbraucherschutzbestimmungen, local content-Auflagen et cetera erschweren oder verhindern im Rahmen eines versteckten, verschleierten Protektionismus den Markteintritt in Emerging Markets. Das Spannungsfeld aus globaler Öffnung und lokalen Anforderungen der Emerging Markets erfordert daher in Form der Auslandsmontage eine andere Markteintrittsform als die klassischen Markteintrittsstrategien Export und Auslandsproduktion. Die Auslandmontage ist somit auch 100 Jahre, nachdem 1904 die Ford Motor Company in Walkersville, Kanada, die ersten, aus den USA gelieferten Fahrzeugteilesätze montierte, als Markteintrittsstrategie von Bedeutung. In der vorliegenden Arbeit wird daher die Forschungsfrage aufgeworfen, wie OEMs Wachstumsmärkte durch die Markteintrittsstrategie Auslandsmontage bearbeiten. Die Entscheidung für die Markteintrittsform Auslandsmontage impliziert für Automobilhersteller das Bespielen stark interdependenter „Gestaltungsgrößen“: Produkt, Produktion, local content, Logistik. Daher stellt sich die Frage der Implementierung der Markteintrittsstrategie in die Funktionsbereiche der Unternehmung, einschließlich der Frage nach der organisatorischen Integration der Projektplanung und Projektsteuerung Auslandmontage in die Unternehmung.
As urban centers incorporating worldwide command and coordination functions, global cities act as major hubs contributing to the global economic system. Early research in the late 1990s focused on first class global cities such as London, New York, and Tokyo. This literature was and is still considered as very original, but its geographical coverage remained limited to OECD urban developments. A number of cities in emerging and developing countries have been underestimated or even neglected, even in Africa such as Cairo, Casablanca Johannesburg, Lagos and Nairobi. Since the turn of the century, research has been completed, notably Bogota, Bombay, Buenos Aires, Caracas, Johannesburg, Jakarta, Manila, Mexico, Santiago and São Paulo. As business internationalization studies have been largely kept out of scant attention in global city research, this chapter aims to present the conceptual debate dealing with global cities mainly from an economic perspective, and to search for linkages with various business internationalization theories. Based on such a cross-combination, the chapter suggests a tentative interdisciplinary approach to study the international business development supportive functions of global cities.KeywordsGlobal citiesBusiness internationalizationInterdisciplinary research
The paper’s aim is to analyse the effect of both trade and financial liberalization on Mexico’s capital formation and intersectoral productive linkages. The impact of both exports and foreign direct investment (FDI) on the stock of capital and their impulse and dispersion effects across the country’s various productive sectors is empirically assessed during the period 1999-2020. Our main results suggest: i) an increase in both exports and FDI did not bring about an increment in the stock of capital; ii) one effect of FDI was the fragmentation of most local subsectors and their lack of international insertion; iii) a significant statistical relationship between FDI and forward linkages does not seem to exist and iv) a negative relationship between variations in productivity/competitiveness and fixed capital formation was found.
The banking segment is the engine of any nation's economy. The economic status of any nation rest on how stable their banking industry is. In other words, any issue that affects banks also has an impact on the economy of the nation. This study assess the implication of treasury single account on banks in Nigeria; a study of first bank of Nigeria PLC. A sample of 200 participants were randomly selected across 50 branches of first banks in Plateau, Ondo, Bayelsa, Bauchi, Kaduna and Enugu state. Primary and secondary data were used for this study. Descriptive statistics such as percentage was used to analyse the socio-demographic variable of the respondents in this study and inferential statistics such as regression and correlation analysis were used to analyze the data to test the three hypotheses in this study with the aid of SPSS version 25 software. The results revealed that TSA policy which seeks to reduce FG Deposit in the commercial banks has significantly reduce the level of banks liquidity. TSA policy which seeks to reduce FG Deposit in the commercial banks has significantly reduce Commercial Banks Deposit Mobilization TSA policy which seeks to reduce FG Deposit in the commercial banks has significantly reduce Loans and Advances. The study recommends that government should secure as soon as possible the appropriate legislative support to facilitate the relevant regulatory environment which will drive the effective implementation of the TSA in the states and local governments in order to promote accountability and transparency at all levels of government and the banks should avoid over-reliance of government funds and source for funds from other sectors of the economy among other recommendations were made.
In business history, it has become a well-accepted fact that engineers have lost territory to business school candidates in the most recent phases of modern capitalism. This article puts up for debate whether business historians studying Northern Europe have perhaps been too willing to accept this diminishing role of the engineer in the understanding of national business systems? What we find, looking at three successful Danish businesses since the late nineteenth century, is a persistent importance of what we term the engineer capitalist. Thus, across three different periods we find that engineer entrepreneurs, who were on the forefront of technical knowledge and who came up with innovative ideas for products with a strong commercial potential in international markets, stand out as drivers of innovation and internationalisation. This leads to a preliminary theory of engineer capitalism and to a contribution to the ongoing reinterpretation of Danish business history.
This study examined the impact of foreign direct investment on Nigeria economic growth at large using time series data from World Bank Development Indicators. The research employed Auto Distributed Lag Model (ARDL) to investigate the impact of FDI on Nigeria economic growth both in the short-run and long-run. It was revealed that foreign direct investment has positive significant impact on Nigeria economic growth within the period under review. The research therefore concludes, that foreign direct investment has significant impact on Nigeria economic growth collaborating the earlier findings in theoretical and empirical literatures. The research therefore, recommends among others that Nigeria government and other West-African countries should invest more in infrastructural development and on R&D to increase the country domestic firm absorptive capacity and inflow of FDI in the country.
The aim of the study was to present the natural, agricultural and economic factors determining the development of rural tourism in the district of Kościerzyna. The study was attended by all the owners of agritourism farms from the county Kościerski (44 people). The significant problem that concerns the farmers of the Kościerski District, is a small farm area of low class valuation, and consequently, low income from agricultural production and not enough resources to maintain families. The research shows that in the Kashubian agritourism is a kind of activity that brings significant revenue.
Foreign direct investment (FDI) plays a vital role in boosting economic growth and providing more job opportunities. Hence, it is imperative to investigate the factors that can spur FDI inflows in the Southeast Asia region (ASEAN) and its three largest trading partners: China, Japan, and South Korea (ASEAN+3). Besides, whether corruption can boost or decrease FDI inflows, and whether larger environmental degradation triggers FDI inflows have been sparsely explored by previous studies. The panel Autoregressive Distributed Lag (ARDL) approach is employed to analyze the period from 1995 to 2020. The results show evidence of the grabbing hand hypothesis in ASEAN+3 as decreasing corruption can positively impact FDI inflows in the long run. However, the results support that increasing environmental degradation has spurred FDI in the region, suggesting reformulating investment promotion policies towards more environmentally friendly ones. These findings are important for policymakers to formulate the right policies for boosting FDI. Punishment for those who act in a corrupt manner may act as a deterrent to would-be offenders. Using more renewable energy could help to reduce environmental degradation and boost FDI simultaneously.
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