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3.0 Literature Review
Global economy has been characterized by increase in the level of FDI. Numerous authors argued that FDI enhances the productivity of host countries and contribute economic development. Because, FDI may not only provide capital but also create positive externalities via the foreign technology and know-how while attracting to local firms, which can help improving an economy. (Blomstrom and Kokko, 1998; Gorg and Greenway, 2004; Lipsey 2002; Barba, Navaretti and Venables 2004; Alfaro and Rodriguez-Clare, 2004 ).
According to these arguments, industrialized and developing countries have offered incentives to encourage FDI in their economies. However, the current movement of FDI is extremely complicated, and is subject to a vast variety of factors related to the competitive business environment in which companies attract, according to their determining factors, and economic factors in the home and host countries.
FDI is a “form of international inter-firm cooperation that involves significant equity stake and effective management decision power in, or ownership control of, foreign companies” (De Mello, 1999, p. 135). Moreover, there are two types of foreign investments. These are Portfolio investment that is short term, and based on profit oriented, and FDI which is an investment involving a long-term investment and control by a foreign investor in an enterprise resident in an economy– UNCTAD definition. In additionally, FDI takes place in two ways: “Mergers and Acquisitions” (M&As) that is, the purchase by Trans-National Companies (TNC)s of existing domestic companies, in whole or in part; and “Greenfield Investment,” that is, the capital stock and the creation of new productive capacity.

yasin ekrem serim- Türkiye Tez

7 Ocak 2013 Pazartesi

yasin ekrem serim- Türkiye Tez: Tez Turkeyhttp://www.tezturkiye.com/tez/ 3.0 L...

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