gb8 - R easons for Foreign D i rect I nvestment Recall that...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Recall that companies that operate overseas have to overcome a liability of foreignness, so any activities they engage in overseas must be economically beneficial. British scholar John Dunning has summarized the advantages of foreign direct investment as the OLI advantages: ownership, location, and internatilization. Ownership advantages: A firm engages in foreign direct investment in order to gain ownership of certain valuable, rare, hard-to-imitate, organizationally embedded assets in another country. Foreign direct investment gives a firm an ownership interest that provides management control rights. Sometimes, management and control rights make foreign direct investment superior to licensing, exporting, or some other firm of foreign indirect investment. Licensing is a transaction in which a firm sells or rents its intellectual property or technology to another firm. Foreign direct investment prevents the loss of
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 02/06/2011 for the course GEB 3373 taught by Professor Crum during the Spring '10 term at University of Florida.

Page1 / 3

gb8 - R easons for Foreign D i rect I nvestment Recall that...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online