Interdependence of OLI variables?
as is set out more formally in the next sub-section, FDI based upon the O advantages of the investing firms in time t may well affect the L advantages of the host country in time t + 1; while the response of firms, by use of either a `voice’ or an `exit’ strategy, to market failure (Hirschman, 1970) and/or their choice of location for their innovating activities, might critically affect the shape of their future O advantages. Indeed, I would go further and suggest it is the successful coordination of the O advantages of foreign and domestic firms with their own L advantages, and how each affects and is affected by the modality of resource deployment, that determines the extent to which a particular country is able to sustain, or upgrade its wealth creating capacities over a period of time.
Interdependence of OLI variables? as is set out more formally in the next sub-section, FDI based upon the O advantages of the investing firms in time t may well affect the L advantages of the host country in time t + 1; while the response of firms, by use of either a `voice’ or an `exit’ strategy, to market failure (Hirschman, 1970) and/or their choice of location for their innovating activities, might critically affect the shape of their future O advantages. Indeed, I would go further and suggest it is the successful coordination of the O advantages of foreign and domestic firms with their own L advantages, and how each affects and is affected by the modality of resource deployment, that determines the extent to which a particular country is able to sustain, or upgrade its wealth creating capacities over a period of time.
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