Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
1002734 | International Business Review | 2007 | 19 Pages |
Abstract
This paper confronts two alternative approaches for explaining U.S. foreign direct investment (FDI) pattern in developing countries. According to the real options (RO) approach, FDI in capital-intensive industries should be particularly deterred by political and macroeconomic uncertainty. On the other hand, the supply chain risk management (SCRM) approach puts forward that multinational enterprises in vertically integrated industries are unlikely to locate their foreign activities in risky countries. Thanks to the use of sectoral data, it is demonstrated that the SCRM approach explains much better the pattern of U.S. FDI in developing countries than the RO approach.
Related Topics
Social Sciences and Humanities
Business, Management and Accounting
Business and International Management
Authors
Rodolphe Desbordes,