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Eclectic Paradigm and FDI Insights

This comprehensive four volume set includes all major contributions to the field of international business. It also includes key writings in the areas of international political economy and on regional and national issues.

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Abdul wadood
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4 views12 pages

Eclectic Paradigm and FDI Insights

This comprehensive four volume set includes all major contributions to the field of international business. It also includes key writings in the areas of international political economy and on regional and national issues.

Uploaded by

Abdul wadood
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPT, PDF, TXT or read online on Scribd

International

Business
Lecture No,33
By
[Link] Ansar

Eclectic Paradigm

Why FDI?

Eclectic Paradigm
Johns Dunnings,

Location specific
Advantages

Export
Licensing

Limitations of Export

Limitations of
Licensing

Technology Loss

Lose Control over manufacturing

Base of Competitive advantage and


Licensing

The Form of FDI: Acquisitions


versus Green-Fields
The majority of investments is in
the form of mergers & acquisitions:
Represents about 77% of all flows
in developed countries.
Represent about 33% of all flows
in developing countries.
Fewer target firms.

The Form of FDI: Acquisitions


versus Green-Fields
Why the preference for mergers &
acquisitions?
Quicker to execute.
Foreign firms have valuable
strategic assets.
Believe they can increase the
efficiency of the acquired firm.

FDI and Risk


FDI is expensive and risky
compared to exporting or
licensing:
Costs of establishing
facilities.
Problems with doing
business in a different culture.

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