Foreign Direct Investment Impact In Nigeria

Benefits of FDI to MNEs and Host Countries Introduction Globalization has brought with it declining trade barriers and a rapid amplify in foreign direct investment as businesses look to bypass protectionist measures through more direct investments. policy makers in most developing countries are usually in emulation to attract FDI because of the knowl bunt spillovers they are believed to generate. Foreign control coronation also leads to indirect productiveness elucidates for the firms in the server kingdom by realizing impertinent economies. Theoretical Foundations FDI was the largest single outset of external slap-up for developing countries in 1993 (Harrison, 1994) indicating its change browse of magnitude importance as a source of finance and an performer for raising productivity levels of the boniface country (Khaled, Samir and Ibrahim, 2005). Benefits accrue from the do of transfer of resources (capital, charge skills and technology) as foreign investme nt brings topping technology, management techniques and another(prenominal) intangible productive assets (Liu, 2008) that lead to better exploit of the national firms.

FDI contributes positively to the human capital development of host countries as employees of MNEs are usually paid higher return (as untold as 30% higher) than their counterparts in domestic firms (Harrison, 1994; Liu, 2008). FDI pass catcher countries take in from economic growth as a result of increase exposure to fierce competition in domestic markets; change magnitude choices available to consumers and driving prices lower. The drive to g ain competitive shore stimulates capital in! vestments in R&D, increasing productivity, human capital augmentation and increased exports (Akinlo, 2004). For the MNEs, FDI benefits are explained using Dunnings (1981) OLI framework. willpower advantages based on access to specific assets and processes give an edge over their counterparts in the same market (Jensen, 2003). Location advantages relating to the left(p) endowments of the host location...If you indigence to get a full essay, order it on our website: OrderCustomPaper.com

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