81 investment risk investment risk includes the risk

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Unformatted text preview: tment risk includes the risk that a host government will interfere with the repatriation profits andthe control of foreign assets, of and the risk of a breakdown in the international trade and investment policies of the government [Herring 19831. T hese are measured by managerial perceptions of the host government’s policies toward conversion and repatriation of profits, expropriation of assets, and the stability of the political, social and economic conditions in the host country. The reliability coefficient for this measure was found to be 0.90. Internalization Advantages Contractual R isk. The assessment of internalization advantage is based on the relative costs (or isks) of sharing the assets and skills with a hostcountry r f i i versus integrating them within the Because such costs are difficult firm. to estimate [Buckley 19881, researchers have recommended the measurement of contractual risks associated with sharing the firm’s assets and skills [Dunning 19801. Therisksinvolvedinu...
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This document was uploaded on 03/22/2014.

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