Answer: Because of increase in pressure from the local governments to employ locals and the increase in costs of expatriate staffing, especially when the firm has to pay taxes for the workers of the parent-company in both countries.
Explanation:
Most MNCs usually start their operations in a region by selecting primarily from their pool of managers. With the passage of time and increase in internationalization, multinational corporations move to a regiocentric or polycentric policy because of
• increasing pressure which could either be implicit or explicit from local governments to employ locals or legal restraints on using expatriates.
• the greater costs of staffing of expatriate especially when tax has to be paid for the parent-company workers in both countries.
