IDEAS home Printed from https://ideas.repec.org/a/jct/journl/v4y2009i2p111-115.html
   My bibliography  Save this article

Foreign Direct Investment and its Theoretical Approaches

Author

Listed:
  • Dinesh Kumar

    (Lecturer, Department of Economics, C.C.S. University, Meerut.)

Abstract

Multinational Enterprises enter the host countries via FDI, portfolio investment, export or through leasing of technology and patents (Frank, 1980).While considering cross border investment, it is important to distinguish between FDI and Portfolio Investment. Portfolio Investment involves passive holding of securities and other financial assets, which does not reflect active management or control or both of the security’s holders. High rates of return and reduction of risk through geographic diversification positively influence it. The management dimension is what distinguishes FDI from Portfolio Investment in foreign stocks, bonds and other financial instruments Several theories on FDI as envisaged above basically cover two distinct approaches: microeconomic approach approach (Buckley and Casson, 1976). While microeconomic approach to FDI flow attempts to explain why firms in one country are successful in penetrating into other markets, the macroeconomic approach (Buckley and Casson, 1976) tries to examine why firms look for international expansion.

Suggested Citation

  • Dinesh Kumar, 2009. "Foreign Direct Investment and its Theoretical Approaches," Journal of Commerce and Trade, Society for Advanced Management Studies, vol. 4(2), pages 111-115, October.
    • Handle: RePEc:jct:journl:v:4:y:2009:i:2:p:111-115
    as

    Download full text from publisher

    File URL: https://www.jctindia.org/index.php/jct/article/view/o09-dk
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    stress; employee attraction; pressure; turnover; retention strategies;
    All these keywords.

    JEL classification:

    • A0 - General Economics and Teaching - - General
    • C0 - Mathematical and Quantitative Methods - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:jct:journl:v:4:y:2009:i:2:p:111-115. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Dr. Himanshu Agarwal (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.