ABSTRACT
There is little question that every aspect of economic activity is being affected by the processes of globalization. As we approach the twenty-first century, a worldwide system of production and distribution is evolving, in much the same way as national markets evolved from local and regional networks during the nineteenth century (Chandler 1990). In nearly every economically active country of the world, the importance of international trade and foreign direct investment (FDI) has risen significantly over the past decade. (For a review of the multinational corporation in the 1980s see Kindleberger and Audretsch 1983.) The growth of FDI has been particularly dramatic, increasing more rapidly than either world production or world trade. As a result, both in-bound and out-bound FDI stocks have increased relative to total investment and gross domestic product in nearly every country (Dunning 1995). Cross-border intra-firm activities are now the norm rather than the exception.
