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Sunday, 11 December 2005 18:07

Future prospects of theoretical and empirical developments in FDI

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It is a clear watermark seen that the future prospects of theoretical and empirical developments in the IDE that they will focus, in short run, on the game theory, given the dominance of the oligopolistic market structure due to the relatively small number of important stakeholders (whose work has a direct impact on other stakeholsders) where the relevance of the explanatory power of the game theory.

It may be a game with one player (theoretical), two players (monopoly and the state of the host country), or a duopoly where each player has initial resources, strategies, and his own goals. It should be noted here that this is not just multinational corporations that are considered as actors or players, the state also (home or host) is a full-fledged player. In addition, unlike most games, players do not initially have the same resources or the same goals or the same function of behavior and, therefore, means the same methods of acting and reacting, in other terms, not the same strategies.

In one hand, the contribution of this theory and its explanatory power has increased with the overwhelming trend of concentration of capital, which is increasing competition between firms on the one hand, between investors and states, and hosting country for attracting more FDI and best quality.

On the other hand, the dynamics of FDI raises controversy about the potential change in the political hierarchy in the international arena, and the interdependence of states vis-à-vis multinational corporations (MNCs) main driver of FDI . On the academic side, it could contribute to the emergence of patterns of growth and more differentiated development.

Finally, studies on the impact of FDI on the home economy and the impact of FDI on employment, including indirect jobs, seem to be rare, and show that the way for future research remain unexplored …

Read 2896 times Last modified on Monday, 07 November 2022 08:15