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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,
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.
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
f i i versus integrating them within the Because such costs are difficult
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.
- Summer '14