Showing papers on "Foreign portfolio investment published in 1980"
TL;DR: In this article, the role of host country characteristics as determinants of foreign direct investment location patterns was reviewed and the effects of corporate experience on location decisions were analyzed. And the authors found that prior experience in a host country was found to increase the firm's priority for projects in that country relative to other investment options.
Abstract: This article reviews the role of host country characteristics as determinants of foreign direct investment location patterns. It then analyzes the effects of corporate experience on location decisions. Prior experience in a host country is found to increase the firm's priority for projects in that country relative to other investment options. In addition, the experience level of the firm influences the relative importance of different country characteristics in determining location patterns. Inexperienced firms exhibit greater preference for near, similar markets than firms with broader international operating experience.
872 citations
TL;DR: This paper made an attempt to survey the literature on the determinants of foreign direct investment (FDI), focusing on the main currents of thought rather than on coverage of all the publications, and this survey is selective also in the sense that the marxist and dependencia schools of thought are not covered here.
Abstract: Foreign direct investment (FDI) has registered an enormous growth over the past three decades. Whereas during the fifties and early sixties the United States and the United Kingdom were by far the biggest exporters of FDI, the entry of German and Japanese firms into this field has since then considerably increased the international competition for overseas investment opportunities. The growth of FDI has, however, been excelled by the growth of publications specially on the determinants of these investments. An attempt is made in this paper to survey this literature1. Attention is focused on the main currents of thought rather than on coverage of all the publications.2 This survey is selective also in the sense that the marxist and dependencia schools of thought are not covered here. There are two reasons for this. Firstly, the explanations offered by them for FDI are dominated by ideological argumentation and as such cannot be fruitfully compared with the explana -
686 citations
TL;DR: In this article, it is argued that the existing theories are basically sub-sets of the general theory of internalization, which was first advanced by Coase [1937] m a domestic context and by Hymer [1976] in an international dimension.
Abstract: The world is characterized by imperfections in the goods and factor markets which act as barriers to the free trade of goods and services and inhibit private international financial investment. As a result neither factor price equalization nor goods price equalization has been observed. Further, there is a large volume of foreign direct investment and international production by the multinational enterprise (MNE), an activity which cannot be explained readily by conventional trade theory alone. A large literature has developed in order to offer explanations of the phenomenon of foreign direct investment (FDI) and the reasons for international production by the MNE. It is argued in this study that the existing theories are basically sub-sets of the general theory of internalization. This theory was first advanced by Coase [1937] m a domestic context and by Hymer [1976] in an international dimension. It is synthesized in a book by Buckley and Casson [1976] and in a paper by Dunning [1977]. Internalization serves to determine the reasons for the foreign production and sales of the MNE, namely that these activities take place in response to imperfections in the goods and factor markets1.
429 citations
TL;DR: In this paper, the authors present a theory to explain one aspect of foreign investment regime change: the formal nationalization or expropriation of foreign-owned subsidiaries operating in natural resource extraction.
Abstract: Many developing countries have become increasingly activist toward multinational corporations in recent years. A number of governments have significantly altered the national regime for foreign direct investment (FDI) in order to shift ownership and control toward the host country. The national regime for FDI is the set of rules, regulations, and behavioral norms under which foreign enterprises are expected to operate. Foreign investment regime change can occur in a number of ways (formal expropriation, cancellation of contracts or concessions, alteration of taxation and royalty formulae, limitations on profit repatriation, requirements of local equity participation, etc.) that affect the operational autonomy and financial returns of the foreign firm. This paper will present a theory to explain one aspect of foreign investment regime change: the formal nationalization or expropriation of foreign-owned subsidiaries operating in natural resource extraction.
105 citations
66 citations
28 citations
TL;DR: In this article, the effects of outflows and inflows of direct investment on U.S. domestic investment were investigated based on the ex post patterns of direct investments, and separate hypotheses were offered on the effect of these outflows on domestic investment.
24 citations
TL;DR: In this paper, the authors show that the explanation of direct foreign investment based on the existence of a currency premium implies a bias in the home capital market of the multinational firm, and that an alternative and complementary explanation of the choice between licensing and direct Foreign investment may be found in "disagreements" in the negotiations for a license.
Abstract: This note shows that the explanation of Direct Foreign Investment based on the existence of a currency premium implies a bias in the home capital market of the multinational firm. An alternative and complementary explanation of the choice between Licensing and Direct Foreign Investment may be found in “disagreements” in the negotiations for a license.
15 citations
01 Jan 1980
TL;DR: A summary of the more recent and relevant literature on direct and portfolio investment is presented, followed by a review of some recent theoretical and econometric work, especially that related to Canada as mentioned in this paper.
Abstract: The theoretical literature on direct investment as relevant for the book is discussed here. In this section, a summary of the more recent and relevant literature on direct and portfolio investment is presented, followed by a review of some recent theoretical and econometric work, especially that related to Canada. For a fully comprehensive review of the literature, see Hood and Young (1979).
14 citations
TL;DR: In this paper, the authors examine the generality of conditions under which these conclusions hold and show that, despite a voluminous literature demonstrating that an abundance of capital in the US is not a major determinant of foreign investment, the studies which have gained major attention in the debate on taxation treat the multinational firm as simply a simply a
Book•
01 Jan 1980
Journal Article•
TL;DR: The Foreign Investment Review Act (FIRA) as mentioned in this paper was a response to a growing nationalist feeling in the early 1970's, from which developed a resentment of the seeming omnipresence of foreign business in the Canadian economy and a fear of the long-term consequences of such presence.
Abstract: The regulatory scheme mentioned is the Foreign Investment Review Act (FIRA)passed by the Parliament of Canada in December 1973. The FIRA was a response to a growing nationalist feeling in the early 1970’s, from which developed a resentment of the seeming omnipresence of foreign business in the Canadian economy and a fear of the long-term consequences of such presence. In examining the FIRA, this Note will explore the factors that led to passage of the legislation. The Act will be analyzed in depth. Important statutory language will be defined and explained, and the review process of the FIRA will be outlined. Finally, the Note will discuss the success of the FIRA and consider its effect on investment in Canada. CANADA'S FOREIGN INVESTMENT REVIEW ACT REVISITED
Journal Article•
TL;DR: The sudden growth of foreign direct investment in the United States in the 1970s caused Americans a good deal of concern The US "open door" attitude, the decline of US stock prices, and the continuous weakening of the US dollar were the major causes of foreign penetration as mentioned in this paper.
Abstract: The sudden growth of foreign direct investment in the United States in the 1970s caused Americans a good deal of concern The US "open door" attitude, the decline of US stock prices, and the continuous weakening of the US dollar were the major causes of foreign penetration Foreign direct investment in the United States is expected to grow in the 1980s, despite more stringent US legal requirements
Journal Article•
TL;DR: The old fear in many parts of the world of increasing U.S. control of foreign chemical industries has changed to fear in the U. S. of the same thing happening in reverse as discussed by the authors.
Abstract: The old fear in many parts of the world of increasing U.S. control of foreign chemical industries has changed to fear in the U.S. of the same thing happening in reverse. Indeed, one of the outstanding trends of the 1970's was the greatly increased flow of the world's chemical investment funds into the U.S. because of newly perceived advantages in U.S. raw material costs, labor costs, political stability, and other background conditions. But in spite of the big foreign takeover announcements, not that much has really changed. True, fresh chemical investment into the U.S. from outside is now slightly ahead of U.S. chemical investment in other countries. However, gross investment and earnings by U.S. chemical interests in other countries still far exceed investment and earnings of foreign chemical interests in the U.S. And foreign-owned chemical operations in the U.S. are still a small part of the total industry. That's the picture emerging from the mass ...
01 Jan 1980
TL;DR: In this paper, the question of whether anticipated Canadian energy resource developments can be adequately funded through the financial markets is addressed, and historical evidence shows that capital has been available during previous periods when investment in Canada reached a peak as a fraction of GNP.
Abstract: This paper addresses the question of whether anticipated Canadian energy resource developments can be adequately funded through the financial markets. Historical evidence shows that capital has been available during previous periods when investment in Canada reached a peak as a fraction of GNP. For the future, forecasts of energy investment are compared with forecasts of total economic activity to conclude that the relative level of investment activity will not be greater than has been achieved in the past. Since relative levels of investment expenditure projected here are lower than those foreseen by others, sufficient real productive capacity should be available. The supply side of the financial markets then shows that, if historical patterns of supply of funds persist, the total financial resources can be available. The final step in the financing process then is to ensure that appropriate financial vehicles are devised to carry the supply of savings through the financial markets to the investing companies.