Compare And Contrast The Main Micro And Macroeconomic Theories Of Foreign Direct Investment. Referring To Your Home Country(india) Appraise Which Of These Theories Most Accurately Explains The Pattern Of Foreign Direct Investment In Recent Years.

Stephen Hymer , an economics author based on Marxist salute describes FDI as opportunities of oligopolistic MNE to create actions that put down barriers to entry modes of competitors (Mclintock , 2001 . With oligopolistic markets , the actions of the market attraction are emulated by other riotouss , therefore creating mutual threats a .Internalization theoryThe internalization theory is based from the Marshallian paradigm of imperfect contention (Jean-Pascal , B . 1993 ) or uneven development as expatiate by Hymer . Imperfect markets occurrences cause a unassailable to go its own (internal ) monopolistic activity to overcome the situation . The soaked set up internalize across national boundaries to become an MTE and frankincense the process causes FDIb .Eclectic theory (OLI paradigmEclectic theory by John Dunning draw s its egoism from trade activities and behavioural aspects of the firm . Hosseini (2005 ) acknowledges behavioural economics as a more than(prenominal)(prenominal) determining factor of FDI than economic equilibriums ingrain to indicate economic realism . Shubik (2001 ) is also another violent of the use o f equilibrium models to reconcile underage and macroeconomic theories . The eclectic theory describes resource market , worldwide and strategic asset seeking behaviours of firms , as objectives for FDI .

The theory describes ownership advantages where firm specific capital or knowledge prevails in form of human capital , for instance expatriates and managers , technol! ogies , patents , reputation and woolly touch . The major advantage is that such capital can be replicated across the nations without lose of value or overlap at bottom the firm without incurring costly act costs . consort to Trevino and Grosse (2002 , firms exhibit a high list for FDI when they have more innovations and are technology intensive , the firm managers are more experience in international commerce , the firm is more profitable and there was high financial leverage , in front the global expansion distributor point and variation in the home-country currentness . Next , Localization advantages put a firm at heart reach...If you want to name a full essay, order it on our website: BestEssayCheap.com

If you want to get a full essay, visit our page: cheap essay