MKT 310 Chapter Notes - Chapter 8: Oligopoly, Westphalian Sovereignty
Document Summary
Greenfield investment: the establishment of a new operation in a foreign country. Inflows of fdi: flow of foreign direct investment into a country. Exporting: sale of products produced in one country to residents of another country. Licensing: occurs when a firm (the licensor) licenses the right to produce its product, use its production processes, or use its brand name or trademark to another firm (the licensee). In return for giving the licensee these rights, the licensor collects a royalty fee on every unit the licensee sells. Internalization theory: marketing imperfection approach to foreign direct investment. Market imperfections: imperfections in the operation of the market mechanism. Oligopoly: an industry composed of a limited number of large firms. Multipoint competition: arises when two or more enterprises encounter each other in different regional markets, national markets, or industries. Political ideology and foreign direct investment: the radical view, the free market view, pragmatic nationalism, shifting ideology. Benefits and costs of fdi: host country benefits.