A potentially major negotiating point between an MNE wishing to undertake FDI and the host government is the issue of:
A)level of involvement of host government in top management decisions of the MNE.
B)likely net gain in employment in the host country.
C)technology flow between MNEs and their domestic competitors.
D)use of profits earned in the host country to subsidize competitive attacks elsewhere.

Question

Quizplus · Accepted Answer

Substitution effects caused by displacement of jobs in domestic firms result in the net number of new jobs created by FDI being significantly lower than what is claimed by the MNE.The issue of the likely net gain in employment may be a major negotiating point between an MNE wishing to undertake FDI and the host government.

A Potentially Major Negotiating Point Between an MNE Wishing to Undertake