February 11 MOS Lecture - Licensing can be very risky o Lose trade or production secrets o May lose control over quality marketing strategy etc o May

FDI – CHAPTER 7 (look at charts and determine their meaning) - FDI: the acquisition or construction of physical capital by a firm from one source country in another host country - MNE: a firm that owns business operations in more than one country - Green Field Investment Why FDI? - Because limitations of exporting an licensing as means for capitalizing on foreign market opportunities o Limitations of exporting  Cost  Government restrictions: limits on the amount exported o Limitations of licensing 

This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: Licensing can be very risky: o Lose trade or production secrets o May lose control over quality, marketing strategy, etc. o May lose advantage if success depends upon marketing, distribution, etc rather than just the production itself Benefits of FDI to the Nation State-Host country-Source/home country Benefits vs costs of FDI to nation state-Implications?-Do benefits outweigh costs?-Most FDI is still between developed countries: is that good or bad?...
View Full Document