ABSTRACT

This introduction presents an overview of the key concepts discussed in the subsequent chapters of this book. The book is concerned with the determinants of intra-industry direct foreign investment (IDFI) in the general analytical framework of international economic involvement. It deals primarily with the effects of IDFI on market structure and inter-firm rivalry, in terms of the dynamic criterion of product innovation, that is, introduction of new products by rival firms as a time-dependent corporate strategy. The book examines the relationship of IDFI with foreign trade. It focuses on IDFI between the United States and the European Economic Community. It highlights the differences in national antitrust policies across countries as an important element in the analysis of antitrust and IDFI interactions. The book discusses major public-policy issues of IDFI from the viewpoint of the United States both as a home-and as a host-country.