Welcome to Dr. Siegel's International Business Web Site
GBU 201-001 • CRN 20319 • T,R 1230 to 1345 • Combs 213
Copyright ©2005 C.Siegel
MKT309 • MKT401 • GBU201
Welcome to Dr. Siegel's International Business Web
Site
GBU
201-001
• CRN
20319
• T,R 1230 to 1345
• Combs 213
Copyright
©2005 C.Siegel
MKT309
• MKT401
• GBU201
Ch 7 Foreign
Direct Investment (FDI)
Opening case - Volkswagen
Patterns of
FDI - production, portfolio
Growth - 2003 continued
downturn
- stimulated by Globalization and M&As
FDI flows - home and host country; inflows and outflows; concept of stock
World FDI flow report
Advantages of FDI over exporting and licensing
Explanations
for FDI - why it occurs
Benefits for host/home countries
Costs for FDI
Theories explaining it:
... International PLC
... Market imperfections
... Eclectic theory
... Market power
Management Issues
in the FDI Decision
Control
Purchase or build
Production costs - Maquiladoras
- twin or in-bond plant - Top
100
Knowledge of customer behavior
Following clients and/or rivals
Government Intervention
in FDI
To protect culture, jobs, domestic production, markets, etc.
What the Balance of Payments says - U.S.
Interventions by host country; home country
Government Policy
Instruments and FDI
Designed to promote or restrict FDI:
... Radical View, Free Market View, Pragmatic Nationalism
Host country restrictions or promotions
Home country restrictions or promotions