Lecture 1

Question 1

Motives for internationalization. Why?

Answer 1

• Market-seeking
  
  • Venturing abroad to find customers
• Efficiency-seeking
  
  • To lower costs of performing economic activities, and/or rationalizing existing operations in various location
• Resource-seeking
  
  • To acces resources that are not readily available at home or that can be obtained at lower cost abroad
• Strategic asset-seeking
  
  • To obtain strategic assets (tangible or intangible) which may be critical to their long-term strategy, but that ar not availble at home

Question 2

The impact of technology on society

Answer 2

• Space: activities are not tied to place
• time tasks are fragmented
• Relationships
  
  • taksks are interconnected
  • participants are scattered
  • interactivity at distance

Question 3

Foreign direct investment (FDI)

Answer 3

FDI is the setting up of an organizational unit abroad that is owned by a company domiciled elsewhere.

Alternatives: Exporting, licensing, setting up a joint venture.