国际金融（英文版）Chapter_11_Foreign_Direct_Investment_and_International_Capital_Budgeting教材教学课件.pptVIP

Chapter 11 Foreign Direct Investment and International Capital Budgeting 11.1 Background An investment project is classified as direct investment if the Investor acquires significant control over a firm. Thus, foreign Direct investment (FDI) implies the acquisition and exertion of a significant control over a firm. Reasons for interest in FDI 1. the rapid growth in global direct investment and the change in its pattern. 2. the concern it raises about the causes and consequences of foreign ownership. 3. the possibility offered by FDI for channeling resources to developing countries. 4. FDI is thought to play a potentially vital role in the transformation of state planned economies. History of FDI 11.2 Approaches to international business The following is a common sequence that firms use to develop foreign markets for their products: 1. Export of the goods produced in the source country 2. Licensing a foreign company to use a process or product technology 3. Foreign distribution of products through a subsidiary 4. Foreign (international) production, which is the production of goods and services in a country that is controlled and managed by firms headquartered in other countries Step 3 and 4 involve FDI. 11.3 Theories of FDI The differential rates of return hypothesis The diversification hypothesis The output and market size hypothesis The industrial organization hypothesis The internalization hypothesis The location hypothesis The eclectic theory The product life cycle hypothesis The oligopoly reaction hypothesis The internal financing hypothesis Government regulations Strategic and long-term factors Political instability and political risk Tax policies 11.4 More about taxation Types of taxes Corporate income Withholding taxes Indirect taxes Import duties Taxation of foreign exchange