Determinants of foreign direct investment from the companies coming from arising markets
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Uniwersytet Łódzki
Zakład Ekonomii Wydział Administracji i Nauk Społecznych Politechnika Warszawska
Publication date: 2015-03-31
JoMS 2015;24(1):287–299
The so far theory of DFI – direct foreign investments – does not explain the motives that rule the companies coming from arising markets to start the activity abroad. The left element deals with the competitive advantage of the very companies in case they invest in less developed economies. So far these investments were dominated by the strongest corporations that due to technical and organization advantage could be active in the selected economies. An actual theory of DFI is based on that assumption. But in case of DFI coming from arising markets the problem of a competitive advantage is still an open question. This is why there is a need to elaborate an extension in so far theory by explaining determinants of DFI in case of companies from arising markets. Considering determinants of successful projects from arising economies, like less distance between human capital in arising economies and less developed economies it seems that in coming years DFI should be done in niche projects, that are less risky.