Economics · Foreign Direct Investment (FDI)
The Ownership–Location–Internationalisation (OLI) eclectic paradigm developed by John Dunning explains why firms choose FDI over exporting or licensing. According to OLI, the 'Internationalisation' advantage refers to:
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1The cost advantages a firm gains from locating production in the host country.
- 2The benefit of keeping proprietary knowledge within the firm rather than licensing it to third parties.✓
- 3The preference of host country governments for foreign firms over domestic producers.
- 4The superior technology or brand that gives the firm a competitive edge over local rivals.
Correct answer
The benefit of keeping proprietary knowledge within the firm rather than licensing it to third parties.
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