Terezinha Saracini (Department of Economics, Universidade Estadual de Londrina) Nilson de Paula (Department of Economics, Universidade Federal do Paraná)
Abstract
Although traditional approaches discussing FDI have described it simply as a set-up up of productive units in foreign markets, the global shape of modern corporations has become a challenge for most analyse about this important aspect of international economic relations. The discussion carried out in the paper highlights the internationalization strategies of big companies through the acquisitions of unique assets, able to create ownership advantages, such as economies of scale, knowledge, systems of distribution and product diversification. Hence, firms expand internationally based on capital concentration and market share achieved domestically. By adopting this strategy, firms aim at sustaining their previous positions and raising their profit to a higher level. Furthermore, this process of expansion may occur by internalizing activities by means of FDI, or by transferring them to other companies.
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Paper provided by Universidade Federal do Paraná, Department of Economics in its series Working Papers with number
0052.
Length: 24 pages Date of creation: 2006 Date of revision: Handle: RePEc:fup:wpaper:0052
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References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
Browning, Martin & Hansen, Lars Peter & Heckman, James J., 1999.
"Micro data and general equilibrium models,"
Handbook of Macroeconomics,
in: J. B. Taylor & M. Woodford (ed.), Handbook of Macroeconomics, edition 1, volume 1, chapter 8, pages 543-633
Elsevier.
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