Which theory of foreign direct investment attempts to combine (1) the theories that focus on favoring direct investment when exporting and licensing are available and (2) theories that say certain locations are favored over others for FDI

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18-03-2022
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Which theory of foreign direct investment attempts to combine (1) the theories that focus on favoring direct investment when exporting and licensing are available and (2) theories that say certain locations are favored over others for FDI

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anthougo anthougo · Answer 1 · 2022-03-23T11:15:29+01:00

The theory of foreign direct investment (FDI) which attempts to combine foreign direct investment for exports and licenses and favors certain locations is the theory of Internalization.

What is the theory of Internalization?

The idea of internalization believes in the vertical and horizontal integration of firms.

The theory of internalization states that unless firms have firm-specific advantages and FDI provides benefits of exploiting firm-specific advantages, which outweigh the relative costs of the operations abroad, multinational firms would not invest their capital abroad.

Thus, the theory of foreign direct investment (FDI) which attempts to combine foreign direct investment for exports and licenses and favors certain locations is the theory of Internalization.

Learn more about foreign direct investments at https://brainly.com/question/14482863