ABSTRACT
Although the eclectic paradigm (or the eclectic theory as it was initially called) of international production was first put forward by the present author at a Nobel Symposium in Stockholm in 1976, its origins can be traced back to the mid-1950s. At that time, I was writing my PhD thesis, later to be published as a book (Dunning 1958), on US direct investment in British manufacturing industry. Earlier research by Rostas (1948), Frankel (1955) and some Anglo-American study teams1 had shown that the labour productivity in US manufacturing industry was, on average, 2-5 times higher than that in UK industry. The question this fact posed in my mind was: ‘was this difference in productivity a reflection of the superior indigenous (and immobile) resources of the US (cf. the UK) economy; or was it due to the more proficient way in which the managers of US firms (cf. UK firms) harnessed and organised these resources?’—a capability which, I argued, might be transferable, at least to some extent across national boundaries.
