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Unformatted text preview: tive impact on inward foreign direct
investment and technology transfer.
Recent trends indicate a move by developingcountriestodo
whereby conditions are being created for more favorable investment climate
through relaxation of investment controls and provision of investment incentives including better protection property rights and enforcementof conof
tracts. Under these circumstances,firms with higher ownership advantages
can derive pioneering benefits by being the iirst to enter these countries.
For instance, Pepsi gained entry into India through a complex contractual
arrangement (with 39.9% equity joint venture) .primarily because as the
Presidentand Chief ExecutiveOfficer of Pepsi-ColaInternational, M r .
Robert H. Beeby said, “We’re willing to go so far with India because we
wanted to make sure we get an early entry while the marketis developing”
[Spaeth and Naj 19881. This gives Pepsi access to a large market that i
expected to becomeless riskier in terms of enforcing contracts.
LIMITATIONS AND CONCLUSIONS The major objectiveof t i...
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This document was uploaded on 03/22/2014.
- Summer '14