International Business
International business studies the operations and management of firms across national borders — multinational enterprises and cross-border activity.
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Scope
It covers foreign direct investment, the multinational enterprise, entry modes, and managing across cultures and institutions.
Core questions
- Why and how do firms operate across borders?
- Why does foreign direct investment occur?
- How do firms enter foreign markets?
- How is management adapted across cultures?
Key concepts
- Foreign direct investment
- Multinational enterprise
- OLI paradigm
- Entry modes
- Internalization
- Cross-cultural management
Key theories
- Product life cycle
- Vernon explained international investment and trade through the product life cycle.
- The eclectic (OLI) paradigm
- Dunning explained multinational production through ownership, location, and internalization advantages.
History
International business developed product-cycle (Vernon) and internalization/eclectic (Dunning) theories of the multinational firm, now studying global value chains and emerging-market multinationals.
Debates
- Why do multinationals exist?
- Whether FDI is explained by market power, internalization, or location advantages.
Key figures
- Raymond Vernon
- John Dunning
Related topics
Seminal works
- vernon-1966
- dunning-1980
Frequently asked questions
- What is the OLI paradigm?
- Dunning's framework explaining multinational production by Ownership, Location, and Internalization advantages.