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Direct Investment and Multi-national Enterprise

In: A Generalized Theory of International Trade

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  • H. Peter Gray

Abstract

Colonial ties facilitated the combination of capital and technology from rich countries with the cheap labour and natural resources of the colonial territories by reducing to a minimum the political and physical risks involved. Colonialism ceased to be an important force after World War Two and movements of factors have to take place between separate and sovereign states — albeit states of different military and economic power. These movements of factors can take place between the erstwhile colonial power and independent dominions (the United Kingdom and Canada and Australia) or between an erstwhile mother country and a tropical ex-colony (France and the Ivory Coast) and between nations that have never had peacetime political connections (Japan and Thailand). These flows of investment must all be seen as international investment and must involve the risk of expropriation or nationalization.

Suggested Citation

  • H. Peter Gray, 1976. "Direct Investment and Multi-national Enterprise," Palgrave Macmillan Books, in: A Generalized Theory of International Trade, chapter 9, pages 143-159, Palgrave Macmillan.
    • Handle: RePEc:pal:palchp:978-1-349-02883-2_9
    DOI: 10.1007/978-1-349-02883-2_9
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