Foregin Direct Investment to low-cost coutries

Many manufacturing companies expand their production to low cost countries through different types of foreign direct investments in an attempt to reduce costs. Mexico is one of these low cost countries and is becoming a more and more feasible alternative to Swedish companies. The reasons for this lie in different country specific factors such as closeness to the US, the Maquiladora industry and of course the low labour costs.The purpose of our dissertation has been to find correspondence between a number of well-known internationalisation theories and some internationalised Swedish companies.This dissertation presents different Mexico specific factors to consider before an expansion such as education level, the Mexican business culture and infrastructure.Briefly, our conclusions are that we could not find any correlation between the internationalisation theories and the interviewed companies. We also found the Mexican market attractive for Swedish investors. However, there are a number of issues that have to be regarded in order to be successful in Mexico.

Contents

Chapter 1 Introduction
1.1 Background
1.2 Problem
1.3 Purpose
1.4 Limitation
1.5 Research Questions
1.6 Outline
Chapter 2 Method
2.1 Methodology
2.2 Data Collection
2.2.1 Secondary Data
2.2.2 Primary Data
2.3 Research Philosophy
2.4 Research approach
Chapter 3 Theoretical Framework
3.1 Internationalisation
3.1.1 History of internationalisation
3.1.2 Foreign Direct Investment
3.1.2.1 Mergers and Acquisitions
3.1.2.2 Greenfield Investment
3.2 Theories
3.2.1 The Uppsala Model
3.2.1.1 The Stage Model
3.2.2 The Network Model
3.2.2.1 The early starter
3.2.2.2 The lonely international
3.2.2.3 The late starter
3.2.2.4 The international among others
3.2.3 Transaction Cost Analysis Model
3.2.3.1 Transaction costs
3.2.3.2 TCA Control Instruments
3.4 Hypotheses
3.4.1 Introduction
3.4.2 The Uppsala Internationalisation model
3.4.3 The Network model
3.4.4 Transaction Cost Analysis theory
Chapter 4 Empirical Method
4.1 Research Strategy
4.2 Sample
4.3 Limitation
4.4 The Interviews
4.4.1 Interview questions
4.4.2 Follow-up questions
4.5 Response rate
4.6 Validity
4.7 Reliability
4.8 Generalisability
Chapter 5 Empiricism
5.1 The Uppsala theory
5.2 The network model
5.3 The Transaction Cost Analysis model
5.4 Summary
Chapter 6 Analysis
6.1 The Uppsala model
6.2 The network model
6.3 The Transaction Cost Analysis model
6.4 Answers to research questions 1-3
6.5 Summary
Chapter 7 Empiricism and Analysis – the Mexican market
7.1 Market Analysis
7.1.1 Mexico
7.1.2 Education
7.1.3 Labour
7.1.4 Unions
7.1.5 The Mexican tax system
7.1.6 NAFTA/MEUFTA
7.1.7 Maquiladora
7.1.7.1 Three common types of Maquiladora operation
7.1.7.2 How to start up a Maquiladora?
7.1.8 Mexican Business Culture
7.1.9 Infrastructure
7.2 Answer to research question 4
7.3 Summary
Chapter 8 Conclusion
8.1 Summary of the Theoretical Part
8.2 Summary of the Market Analysis
8.3 Practical Implications
8.4 Methodological Criticism
8.5 Future research
Works Cited
Appendices

Author: Carl-Michael Unger,Viveca Fjelkner

Source: Kristianstad University

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Foregin Direct Investment to low-cost coutries