Dunning (2000)

Management > Global Firm > Lectures > Independent Research > Dunning

Dunning (2000) - The Eclectic paradigm as an envelope for economic and business theories of MNE activity

The eclectic framework combines macroeconomic theories about FDI and the microeconomic theories of the MNE.

Ownership assets are firm-specific advantages, which are superior to those in other companies, particularly in the same country in which they are seeking to make their investments.

Both the eclectic paradigm and internalisation theory argue for internalising cross-border intermediate product markets if the benefits of investment outweigh the costs of being foreign.

The precise configuration of the OLI is very contextual. It completely depends on the firm, industry, country, time and so forth.

There are four types of foreign-based MNE activity:

Market-seeking - to satisfy a particular foreign market (demand-oriented FDI)
Resource-seeking - to gain access to natural resources (supply-orientated FDI)
Rationalised/Efficiency-seeking - to promote a more efficient division of labour/specialisation of an existing portfolio
Strategy Asset-seeking - to augment existing OAs/reduce those of competitors