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Toward a Unifying Model of Foreign Direct Investment Determinants

Aristidis Bitzenis, Pyrros Papadimitriou and Vasileios Vlachos

Chapter Chapter 4 in Mergers and Acquisitions as the Pillar of Foreign Direct Investment, 2012, pp 41-65 from Palgrave Macmillan

Abstract: Abstract This chapter presents the evolution of theories that explain the activity of multinational enterprises (MNEs) and the development of foreign direct investment (FDI). The theoretical approaches that today concern the determinants of FDI are rooted in classical theories of international trade. From the theory of international trade, the literature on the activity of MNEs emerged, which ultimately developed into theories of FDI. Current approaches have been greatly differentiated since the early classical theories were applicable. Their evolution to date, along with the complexity of the modern global business environment, shows that it is impossible for a single approach to develop an explanation for the present activity of MNEs. The current complexity of the international business environment requires a universal—perhaps unifying—all-encompassing model of FDI determinants, which would assist policy makers and managers on an international level.

Keywords: Foreign Direct Invest; Host Country; Home Country; Universal Model; Entry Mode (search for similar items in EconPapers)
Date: 2012
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Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-1-137-03155-6_4

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DOI: 10.1057/9781137031556_4

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