While there is no comprehensive theory of FDI,many existing theories emphasize
A)imperfections in product markets.
B)imperfections in capital markets.
C)imperfections in labor markets.
D)all of the options

Question

Quizplus · Accepted Answer

Many existing theories of Foreign Direct Investment (FDI) emphasize imperfections in product markets, capital markets, and labor markets. Theories that focus on product markets emphasize factors such as product differentiation, economies of scale, and the need for local responsiveness. Theories that focus on capital markets emphasize issues such as financing constraints and the availability of investment opportunities. Theories that focus on labor markets emphasize factors such as differences in wage rates and labor skills. Overall, it is the combination of these imperfections in various markets that motivates firms to engage in FDI.

While There Is No Comprehensive Theory of FDI,many Existing Theories