Global Business Chapter 6

30 cards

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Created Jan 19, 2013
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lil_montana_red

 

 
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1
foreign portfolio investment
 
investment in a portfolio of foreign securities such as stocks and bonds
2
management control rights
 
the rights to appoint key managers and establish control mechanisms
3
hortizontal FDI
 
a type of FDI in which a firm duplicates its home country based activities at the same value...
4
Vertical FDI
 
a type of FDI in which a firm moves upstream or downstream at different value chain stages...
5
Upstream vertical FDI
 
a type of vertical FDI in which a firm engages in an upstream stage of the value chain in a...
6
Downstream vertical FDI
 
a type of vetical FDI in which a firm engages in a downstream stage of the value chain in a...
7
FDI flow
 
The amount of FDI moving in a given period (usually a year) in a certain direction
8
FDI inflow
 
Inbound FDI moving into a country in a year
9
FDI outflow
 
Outbound FDI moving out of a country in a year
10
FDI stock
 
Total accumulation of inbound FDI in a country or outbound FDI from a country across a given...
11
OLI advantages
 
a firm's quest for ownership (O) advantages, location (L) advantages, and internalization...
12
ownership
 
an MNE's possession and leveraging of certain valuable, rare, hard-to-imitate, and organizationally...
13
location
 
advantages enjoyed by firms operating in a certain location
14
internalization
 
the replacement of cross-border markets (such as exporting and importing) with one firm (the...
15
market imperfection (market failure)
 
the imperfect rules governing international transactions
16
dissemination risk
 
the risk associated with unauthorized diffusion of firm-specfic know-how
17
agglomeration
 
clustering of ecnomic activities in certain locations
18
knowledge spillover
 
knowledge diffused from one firm to others among closely located firms
19
oligopoly
 
industry dominated by a small number of players
20
intrafirm trade
 
international transactions between two subsidaries in two countries controled by the same MNE
21
radical view on FDI
 
a political view that is hostile to FDI
22
free market view on FDI
 
a political view that suggests that FDI unrestricted by government intervention is the best
23
pragmatic nationalism on FDI
 
a political view that only approves FDI when its benfits outweigh its cost
24
technology spillover
 
technology diffused from foreign firms to domestic firms
25
domenstration (contagion or imitation) effect
 
the reaction of local firms to rise to the challenge demonstrated by MNEs through learning...
26
bargaining power
 
ability to extract favorable outcome from negotiations due to one party's strengths
27
obsolescing bargain
 
the deal struck by MNEs and host governments, which change their requirements after the initial...
28
expropriation
 
government's confiscation of foreign assets
29
sunk cost
 
cost that a firm has to endure even when its investment turns out to be unsatisfactory
30
sovereign wealth fund (SWF)
 
a state-owned investment fund composed of financial assets such as stocks, bonds, real estate,...

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