Foreign Direct Investment and the Multinational Enterprise - A Re-examination Using Signaling Theory (Hardcover, New)

Internalization theory, despite criticism of its empirical deficiency, has dominated the industrial organization approach to the multinational enterprise and its foreign direct investment (FDI) decisions. Liu improves the empirical foundations of internalization theory, through the elaboration of the FDI signaling framework, which holds that a firm's direct foreign investment influences the perceptions of less-informed market participants. The signaling concept is derived from the premise that a firm's intangible assets in know-how cannot be correctly priced in a market with asymmetric information, and this motivates the firm's decision to undertake FDI. If the premise is correct, the firm's decision is based on inside information, and the firm's action reveals that information to the market. The firm's FDI internalization is evidence of management's confidence in its intangible assets, and its action may further influence market perceptions. The hypotheses generated along this line of analysis are subjected to investigation, and the evidence supports the FDI signaling proposition. Moreover, the study represents an indirect test of internalization theory. As a result, internalization is transformed from a untested theory to an empirical result.

General

Imprint:	Praeger Publishers Inc
Country of origin:	United States
Release date:	September 1997
First published:	September 1997
Authors:	Scott Liu
Dimensions:	234 x 156 x 12mm (L x W x T)
Format:	Hardcover
Pages:	200
Edition:	New
ISBN-13:	978-0-275-95483-3
Categories:	Books > Business & Economics > Economics > Political economy Books > Business & Economics > Business & management > International business Books > Business & Economics > Economics > Microeconomics > General Books > Business & Economics > Economics > International economics > General Books > Business & Economics > Business & management > Ownership & organization of enterprises > Multinationals
LSN:	0-275-95483-8
Barcode:	9780275954833

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