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Trade and FDI revisited: the role of location

In: The Development of International Business

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Abstract

In terms of the broad theoretical prospectus (OLI) this chapter elaborates on location advantage, but does this through an exposition of the ideas of Kojima. The chapter presents the case of ‘trade-creating FDI’ (ES operations in NH-from Chapter 4) as reflecting the ability of MNEs (in a freer-trade context) to activate a country’s sources of ‘static comparative advantage’ as positive LAs, thereby generating enhanced efficiency and welfare and providing host economies with a strong impetus to growth and development. This is contrasted with the case of ‘trade-destroying FDI’ where a constrained international environment (trade barriers operating as negative LAs) generates the inefficiencies of MS operations in the MH.

Suggested Citation

  • ., 2017. "Trade and FDI revisited: the role of location," Chapters, in: The Development of International Business, chapter 5, pages 46-56, Edward Elgar Publishing.
    • Handle: RePEc:elg:eechap:17812_5
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    Cited by:

    1. Obstfeld, Maurice, 2021. "Reprint: Two challenges from globalization," Journal of International Money and Finance, Elsevier, vol. 114(C).
    2. Morrison, Nicola & Szumilo, Nikodem, 2019. "Universities’ global research ambitions and their localised effects," Land Use Policy, Elsevier, vol. 85(C), pages 290-301.
    3. Obstfeld, Maurice, 2021. "Two challenges from globalization," Journal of International Money and Finance, Elsevier, vol. 110(C).
    4. Karen Soldatic & Kelly Somers & Kim Spurway & Georgia van Toorn, 2017. "Emplacing Indigeneity and rurality in neoliberal disability welfare reform: The lived experience of Aboriginal people with disabilities in the West Kimberley, Australia," Environment and Planning A, , vol. 49(10), pages 2342-2361, October.

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