When activities of foreign affiliates can be classified as vertical and horizontal, evidence is consistent with the theoretical prediction that vertical FDI complements exports and horizontal FDI substitutes for exports.
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If multinationals tended to allocate their production in this way, larger affiliate out-put relative to parent output should be associated with lower labor intensity and higher skill intensity in home production.
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Through its exposure to a foreign market, an MNE can learn about superior management techniques and superior product and process technologies. A comparison of montessori and traditional schooling as well as reduced reactivity to negative with energetic aggression.
Deal with technology leakages: One example that we can mention is Apple manufacturing factories in China.
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Additionally, without understanding or research about conditions in host countries and management capability, operational efficiency, the investors from home countries might undergoes dramatic losses from sacrificing capital invested. Kong, there are many well-known cosmetics companies have develop the youngster cosmetics market for several years.
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Case study of Tencent’s E-commerce Strategy Executive Summary Tencent’s E-commerce strategy didn’t work well. The company’s core business is QQ which is an online instant messenger. All of tencent’s other business will be rolled out base upon the QQ.
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