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A retrospective on: Infrastructure or foreign direct investment?

Yamin, Mo; Sinkovics, Rudolf R

In: International Business and Sustainable Development. Bingley, UK: Emerald Group Publishing Limited; 2014. p. 231-247.

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Abstract

This chapter revisits the paper by Yamin and Sinkovics (2009) on the paradoxical relationship between MNE current strategies and economic development. There is evidence that positive developmental impacts of FDI flows are conditional on high levels of human capital and thus on the existence of ‘good’ infrastructure in recipient countries.The chapter makes a conceptual contribution and critically evaluates the key points made in the Yamin and Sinkovics (2009) paper.The build-up of infrastructure and enhancement of domestic capabilities are important underpinnings of sustainable development. ‘Good’ infrastructure, especially basic social infrastructure, is the rock on which otherwise marginalised individuals, groups and country governments can build capabilities.The chapter draws attention to the ‘prisoner dilemma’ nature of the relationship between MNEs and host governments. Dominant MNE strategies in LDCs create a low payoff for both parties. To proceed towards mutually beneficial outcomes in the MNE–LDC relationship, credible and sustained co-operation between the parties are necessary. Research in the area of mutual value creation has only just emerged in the domain of IB.Progressing towards ‘sustainability’ requires that MNE managers are advised to develop a global capability in ‘social embeddedness’. LDCs have great potential of becoming strategic markets and important sites for new product and service development. To pursue these opportunities requires credible and sustained commitment to mutual value creation.This chapter shows that the relationship between MNE strategies and economic development is a contested one. The paper by Yamin and Sinkovics (2009) was one of the first in the domain of IB to suggest that developmental impacts of FDI are contingent on the existence of good infrastructure in recipient countries.

Bibliographic metadata

Type of resource:
Content type:
Type of book contribution:
Publication date:
Place of publication:
Bingley, UK
Contribution start page:
231
Contribution end page:
247
Contribution pagination:
231-247
Contribution total pages:
17
Abstract:
This chapter revisits the paper by Yamin and Sinkovics (2009) on the paradoxical relationship between MNE current strategies and economic development. There is evidence that positive developmental impacts of FDI flows are conditional on high levels of human capital and thus on the existence of ‘good’ infrastructure in recipient countries.The chapter makes a conceptual contribution and critically evaluates the key points made in the Yamin and Sinkovics (2009) paper.The build-up of infrastructure and enhancement of domestic capabilities are important underpinnings of sustainable development. ‘Good’ infrastructure, especially basic social infrastructure, is the rock on which otherwise marginalised individuals, groups and country governments can build capabilities.The chapter draws attention to the ‘prisoner dilemma’ nature of the relationship between MNEs and host governments. Dominant MNE strategies in LDCs create a low payoff for both parties. To proceed towards mutually beneficial outcomes in the MNE–LDC relationship, credible and sustained co-operation between the parties are necessary. Research in the area of mutual value creation has only just emerged in the domain of IB.Progressing towards ‘sustainability’ requires that MNE managers are advised to develop a global capability in ‘social embeddedness’. LDCs have great potential of becoming strategic markets and important sites for new product and service development. To pursue these opportunities requires credible and sustained commitment to mutual value creation.This chapter shows that the relationship between MNE strategies and economic development is a contested one. The paper by Yamin and Sinkovics (2009) was one of the first in the domain of IB to suggest that developmental impacts of FDI are contingent on the existence of good infrastructure in recipient countries.
Digtial Object Identifier:
10.1108/s1745-8862(2013)0000008015
Book ISBN:
1745-8862
Series title:
Progress In International Business Research
Related website(s):
  • Publisher (Emerald) URL http://dx.doi.org/10.1108/S1745-8862(2013)0000008015

Institutional metadata

University researcher(s):

Record metadata

Manchester eScholar ID:
uk-ac-man-scw:217948
Created by:
Sinkovics, Rudolf
Created:
23rd January, 2014, 14:49:38
Last modified by:
Sinkovics, Rudolf
Last modified:
18th November, 2015, 09:15:43

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