Essays on Foreign Direct Investment and Technological Change - KFC in Malaysia Assignment

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The paper "Foreign Direct Investment and Technological Change - KFC in Malaysia" is a perfect example of a business assignment. With the advancement in technology and removal of trade barriers that in the past used to hinder the movement of goods, services, resources and labor across borders, now business can be easily moved from one country to another with more ease. This is because the world market has now become a single large market that can accommodate everybody. It is from this ground that Foreign Direct Investment (FDI), which is the establishment of a venture or business in a foreign country has come into play. a) An overview explanation of what is meant by ‘ foreign direct investment’ (FDI) and its role in globalization. Foreign Direct Investment (FDI) according to International Monetary Fund (IMF) is the investment that is made by an investor with the aim of acquiring a lasting interest in a particular enterprise that is operating outside one’ s economy.

The investment is referred directly because the entrepreneur or investor could be a foreigner to the company, business or entity that is seeking to control or even have a significant influence on.

FDI in the contemporary business environment is playing a very critical in motivating globalization where the whole of the world economy is seen as one single large market that each and every entrepreneur has access to. A good example is Kentucky Fried Chicken (KFC), which despite having been established in the United States over 70 years ago has made a remarkable presence in different parts of the world including Europe, Asia and Africa. Through FDI, different companies are invading the world market and have continued to more presence in those regions that they did not seem to exist before (Aseem and Matthew 2007).

What this kind of move is contributing to, is globalization, which is a process of international integration that comes into being as a result of the exchange of world views, services and products and other material like culture. Some important examples of companies that have contributed to globalization include General Motors, Sony, Marriot Corporation, Hilton worldwide and many more.

References

Ansfield, E 2003, Microeconomic Theory and Applications, 11th ed. W.W. Norton.

Aseem, P and Matthew, P 2007, Investing Up: FDI and the Cross-Country Diffusion of ISO 14001 Management Systems, International Studies Quarterly, 51(3), p. 723-744.

Danna, W 2007, "They Had a Satellite and They Knew How to Use It," American Journalism, Spring, Vol. 24, Issue 2, p. 87-110.

Hall, B 2004, “Innovation and Diffusion”, NBER Working Paper No. 10212. p. 12

KFC Holdings 2012, About us, retrieved on 16th January 2013, available online: http://www.kfcholdings.com.my/about-us/

Klaus, EM and Evis, S 2009, When and where does foreign direct investment generate positive spillovers? A meta-analysis. Journal of International Business Studies, 40(7), p. 1075- 1094.

Nigel, D and James, H 2007, Linking FDI motivation and host economy productivity effects: conceptual and empirical analysis. Journal of International Business Studies, 38(3), p. 460-473.

Rogers, E 2003, Diffusion of Innovations, 5th edition, Free Press.

Smeets, R 2008, Collecting the Pieces of the FDI Knowledge Spillovers Puzzle, The World Bank Research Observer 23(2), p. 107-138.

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