Determinants of foreign direct investment
from the companies coming from arising markets
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Zakład Ekonomii
Wydział Administracji i Nauk Społecznych
Politechnika Warszawska
Publication date: 2015-03-31
JoMS 2015;24(1):287-299
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ABSTRACT
The so far theory of DFI – direct foreign investments – does not explain
the motives that rule the companies coming from arising markets
to start the activity abroad. The left element deals with the competitive
advantage of the very companies in case they invest in less developed
economies. So far these investments were dominated by the strongest
corporations that due to technical and organization advantage could be
active in the selected economies. An actual theory of DFI is based on
that assumption. But in case of DFI coming from arising markets the
problem of a competitive advantage is still an open question. This is why
there is a need to elaborate an extension in so far theory by explaining
determinants of DFI in case of companies from arising markets. Considering
determinants of successful projects from arising economies, like less
distance between human capital in arising economies and less developed
economies it seems that in coming years DFI should be done in niche
projects, that are less risky.