The Selected Essays of John H. Dunning, Volume I
Chapter 13: Globalization and the Theory of MNE Activity
* INTRODUCTION This chapter seeks to answer the question ‘To what extent, and in what ways, does the globalization of economic activity require a reappraisal of existing paradigms and theories of international production?’1 More specifically, ‘Are the motives, determinants and organizational modes of international business activity, as identified by scholars in the 1960s and 1970s, relevant and applicable to our contemporary world scenario? Are drastic changes called for, or is it simply that our ideas, propositions and paradigms2 need to be fine-tuned to accommodate the events of the late 1990s?’ The chapter will proceed in the following way. First, it will place the current unease about the state of our theorizing about MNE activity within the context of two previous watersheds in the development of scholarly thinking, viz. those of the early 1960s and of the late 1970s, and it will pinpoint such watersheds by both the events of the time and the advent of new analytical insights. Second, it will consider how contemporary thinking is affecting our understanding about different types of FDI – and particularly that of Third World MNEs, and that directed to augmenting the competitive advantages of the investing firms; and, third, it will consider how far, and in what ways, economic and behavioural theories of MNE activity need to be integrated if they are to adequately explain the dynamics of international production. However, three other introductory points should be made at this stage. The first is that globalization is best considered as a process towards...
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