Define globalization, multinational enterprise (MNE), foreign direct investment (FDI), and global…

Define globalization, multinational enterprise (MNE), foreign direct investment (FDI), and global strategy.

■ Globalization involves closer integration and exchange between different countries and peoples worldwide, made possible by factors such as falling trade and investment barriers, advances in telecommunications, and reductions in transportation costs.

■ A multinational enterprise (MNE) deploys resources and capabilities to procure, produce, and distribute goods and services in at least two countries.

■ Many MNEs are more than 50 percent globalized; they receive the majority of their revenues from countries other than their home country.

■ Product, service, and capital markets are more globalized than labor markets. The level of everyday activities is roughly 10 to 25 percent integrated, and thus semi-globalized.

■ Foreign direct investment (FDI) denotes a firm’s investments in value chain activities abroad.

 

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