『社会科学ジャ
ナノレ』2 9 ( 2 )〔 1 9 9 1 ) p p . 8 5 ‑ 9 8
The J o u r n a l o f S o c i a l S c i e n c e 2 9 ( 2 )〔 1 9 9 1 〕 ISSN 0 4 5 4 2 1 3 4
THE INTEGRATION OF THE INTERNATIONAL PRODUCT LIFE CYCLE THEORY AND THE THEORY
OF INTERNALIZATION: A MANAGERIAL PERSPECTIVE
N o r i h i k o S u z u k i
I n t r o d u c t i o n
A f i r m , whatever s i z e o r s t r u c t u r e 1 t may t a k e , i s an e n t i t y t h a t c r e a t e s goods and s e r v i c e s and d 1 s t n b u t e s t h e s e p r o d u c t s t o s a t i s f y t h e c o n s u m e r s . The p r o d u c t i o n and marketmg a c t i v i t i e s c o n s t i t u t e t h e f u n d a m e n t a l a s p e c t s o f busmess f o r i t s e x i s t a n c e . On t h e o t h e r h a n d , r e d u c i n g t h e c o s t , o r more b r o a d l y , t h e c o s t management i n t h e a d m i n i s t r a t i v e and t r a n s a c t i o n a l a c t i v i t i e s 1 s , though i t i s a v e r y i m p o r t a n t a s p e c t o f b u s m e s s , r e g a r d e d a s a s u p p l e m e n t a r y one f o r t h e e n t i r e management o f t h e b u s i n e s s e n t e r p r i s e
I t can b e s a i d , i n o t h e r w o r d s , t h a t t h e p r o d u c t i o n and/ o r m a r l
王etm f u n c t i o r
】s i n t h e management i s t h e n e c e s s a r y c o n d 1 1 I o n f o r t h e e x i s t e n c e and o p e r a t i o n o f t h e b u s i n e s s e n t e r p r i s e 、 N h i l e t h e c o s t
management c o n s t i t u t e s t h e s u f f i c i e n t c o n d i t i o n f o r i t . M i c h a e l P o r t e r
c l a s s i f i e s t h e two a s p e c t s o f c o r p o r a t e a c t i v i t i e s i n t o ( 1 ) t h e mam
a c t 1 V 1 t i e s and ( 2 ) t h e s u p p o r t i n g a c t i v i t i e s ‑ " ' The mam a c t i v i t i e s i n c l u d e
t h e m a n u f a c t u r i n g , c h a n n e l i n g , m a r k e t i n g , s e r v i c e s and s o on The
s u p p o r t i n g a c t i v i t i e s a r e t h o s e s u c h a s t h e f i n a n c i n g , m f o r m a t i o n
p r o c e s s i n g , handhng t h e l e g a l m a t t e r s , p l a n n i n g , R&D, t o l i s t a f e w .
The n e c e s s a r y and t h e s u f 1 I c 1 e n t c o n d i t i o n s f o r t h e b u s i n e s s e n t e r p r i s e
d e f i n e d a b o v e , and P o r t e r ' s dichotomous c l a s s i f i c a t i o n o f t h e b u s i n e s s
a c t i v i t i e s , 1 e , t h e mam and t h e s u p p o r t i n g f u n c t i o n s , a r e assumed t o
l a r g e l y c o r r e s p o n d w i t h e a c h o t h e r . The n e c e s s a r y and t h e s u f f i c i e n t
c o n d i t i o n s a r e a l s o t o b e s a t i s f i e d s i m u l t a n e o u s l y . S a t i s f y i n g e i t h e r
c o n d i t i o n a t one t i m e w i t h o u t s a t i s f y i n g a n o t h e r may r e s u l t m a n
u n b a l a n c e d performance o f t h e management w h i c h , i n t u r n , may c a u s e
t h e d e t e r i o r a t i o n o f t h e o v e r a l l o r g a n i z a t i o n a l e f f e c t i v e n e s s
The m u l t i n a t i o n a l c o r p o r a t i o n (MNC) i s n o e x c e p t i o n a s an b u s i n e s s e n t i t y t o s a t i s f y b o t h t h e n e c e s s a r y and s u f f i c i e n t c o n d i t i o n s . Both c o n d i t i o n s f o r t h e MNC t o s a t i s f y f o r i t s q u a h f r c a t i o n can be more d e t a r l e d a s f o l l o w s :
The N e c e s s a r y C o n d i t i o n To s a t i s f y a s f a r and d i r e c t l y a s p o s s i b l e t h e termmal consumers l o c a t e d m t h e m u l t m a t t o n a l markets I n more d e t
剖i l e d t e r m s , t h e p r o d u c t i o n and s a l e s network o u g h t t o be e s t a b h s h e d m t h e n e a r e s t l o c a t 1 o n s o f t h e consumers o f vanous c o u n t r i e s .
The S u f f i c i e n t Condition‑To r e d u c e t h e c o s t a l l o v e r t h e w o r l d . B a s i c a l l y , t h e r e a r e two p o s s i b l e ways t o a c h i e v e t h i s o b j e c t i v e :
( a ) To mimmize t h e c o s t a t e a c h o f t h e o p e r a t i n g u n i t s o f t h e MNC T h e o r e t i c a l l y , i n t e g r a t i n g t h e i n d i v i d u a l u n i t s w i t h mm1m1zed c o s t e n a b l e s t h e MNC t o r e d u c e t h e t o t a l c o s t t o t h e l o w e s t l e v e l .
( b ) To a c h i e v e t h e c o s t m m i m 1 z a t i o n t h r o u g h t h e t r a n s f e r p r i c m g s t r a t e g y . T r a n s f e r p r i c i n g r s t h e p r a c t i c e o f t r a n s f e r r m g t h e p r o f i t g e n e r a t e d i n t h e h i g h c o r p o r a t e income t a x c o u n t r y t o t h e low c o r p n r a t e mcome t a x c o u n t r y by m a n i p u l a t i n g b o t h t h e c o s t components and t h e p r i c e s t r u c t u r e i n b o t h c o u n t r i e s .
The I n t e r n a t i o n a l Product L i f e C y c l e Theory and the Theory o f I n t e r n a h z a t i o n a s the Theories Explaining the Necessary and t h e S u f f i c i e n t C o n d i t i o n s f o r the MNC
There have a p p e a r e d many c o n c e p t s , m o d e l s , and t h e o r i e s attemptmg t o e x p l a i n t h e b e h a v i o r and s t r a t e g i e s o f t h e MNCs. Some o f them a r e l i s t e d below even though t h e y may n o t r e p r e s e n t t h e whole body o f r e s e a r c h e s :
( a ) l n t e r n a t 1 o n a l O l i g o p o l i s t i c Approach ( H y m e r , K i n d l e b e r g e r ) " ' ( b ) l n t e r n a t 1 o n a l P r o d u c t L i f e C y c l e Approach ( V e r n o n , W e l l s ) ' "
( c ) I n t e r n a l i z a t i o n ( T r a n s a c t i o n C o s t ) Approach ( B u c k l e y ,
C a s s o n , Rugman)'"
MNC' A M a n a g e ml A p p m a o h 8 7 ( d ) A p p r o p n a b i l i t y Approach (Magee 町 )
( e ) E c l e c t i c Approach ( D u n n i n g ) ' "
( f ) I n t e r n a t i o n a l Economic Approach ( C o m p a r a t i v e P r o f i t a b i h t y Approach) ( K o j i m a ) " '
Among t h e above a p p r o a c h e s , t h e l a s t o n e , n a m e l y , KoJimas a p p r o a c h i s d i f f e r e n t from o t h e r s i n t h a t i t d e a l s w i t h t h e MNCs and t h e i r b e h a v i o r from t h e macroeconomic and/ o r t h e i n t e r n a t i o n a l economic s t a n d p o r n t . The r e m a i n i n g r e s e a r c h e s c o n c e n t r a t e on t h e i n d i v i d u a l f i r r r 九 b e h a v i o r ,a d o p t i n g t h e m a n a g e r i a l and/ o r t h e b u s i n e s s economi
田a p p r o a c h . Among t h e s e managenal/ busmess economic a p p r o a c h e s , h o w e v e r , b o t h t h e i n t e r n a t i o n a l p r o d u c t l i f e c y c l e ( ! P L C ) t h e o r y and t h e t h e o r y o f m t e r n a l i z a t i o n seem t o g r a s p t h e c h a r a c t e r i s t i c s o f busmess a c t r v i t i e s by MNCs most d i r e c t l y . O t h e r a p p r o a c h e s such a s t h e i n t e r n a t i o n a l o h g o p o l i s t i c a p p r o a c h and t h e a p p r o p r i a b i l i t y a p p r o a c h d e a l w i t h t h e MNCs' b e h a v i o r r a t h e r m d i r e c t l y and i t i s d i f f i c u l t t o s a y t h a t t h e s e a p p r o a c h e s d i s c u s s t h e b u s i n e s s i t s e l f
Then, how d o t h i s !PLC and t h e i n t e r n a l i z a t i o n t h e o r y r e l a t e t o o u r n e c e s s a r y and s u f f i c i e n t c o n d i t i o n s f o r t h e MNCs? I t g o e s a s f o l l o w s :
The !PLC i s t h e t h e o r y e x p l a i n i n g t h e MNCs p r o d u c t i o n and m a r k e t i n g s t r a t e g y d e p l o y e d i n t h e m u l t i n a t i o n a l m a r k e t s .
The i n t e r n a l r z a t i o n t h e o r y i s t h e one t o e x p l a i n t h e r e a s o n why and t h e p r o c e s s how t h e MNC m i n i m i z e t h e c o s t a l l o v e r t h e w o r l d .
I t i s t h e r e f o r e o b v i o u s t h a t t h e !PLC i s t h e t h e o r y e x p l a i n i n g t h e MNC's b e h a v i o r t o s a t r s f y t h e n e c e s s a r y c o n d i t w n and t h e i r t t e r n a h z a ‑ t i o n t h e o r y , t o s a t i s f y t h e s u f f i c i e n t c o n d i t i o n The two t h e o r i e s do n o t t a k e o p p o s i n g p o s i t i o n s t o e a c h o t h e r R a t h e r , t h e y o n l y o b s e r v e a f i r m a s a b u s i n e s s e n t i t y from d i f f e r e n t p e r s p e c t i v e s I t i s even p o s s i b l e t o s a y t h a t t h e y a r e s u p p l e m e n t a r y m such m e a n s . The two t h e o n e s a r e a s e t o f w h e e l s o f a v e h i c l e .
The B u s i n e s s Sequence i n the !PLC
The !PLC h a s s e v e r a l s t a g e s i n i t s sequence o f busmess p a t t e r n s f o r
a p r o d u c t c o n c e r n e d t o c o m p l e t e i t s h i e c y c l e m t h e m u l t m a t i o n a l
m a r k e t s ・
( 1 ) D o m e s t i c p r o d u c t i o n o f a h i g h l y d i f f e r e n t i a t e d p r o d u c t s t a r t s i n t h e t e c h n o l o g i c a l l y advanced c o u n t r y l i k e t h e US. The p r o d u c t w i l l n o t e n c o u n t e r any f i e r c e c o m p e ! i t i o n w i t h o t h e r s due t o
出t e c h n o l o g i c a l / f u n d a m e n t a l a d v a n t a g e .
( 2 ) O t h e r d o m e s t i c m a n u f a c t u r e r s w i l l f o l l o w t h e s t r a t e g y and i n t r o d u c e t h e s i m i l a r k i n d o f p r o d u c t s i n t h e market s o o n c a u s i n g t h e l o s s o f c o m p e t i t i v e advantage on t h e p a r t o f t h e p r o d u c t f i r s t mtroduced i n t h i
ぉm a r k e t . The p r o d u c t becomes s t a n d a r d i z e d m i t s home m a r k e t .
( 3 ) The m a n u f a c t u r e r who i n i t i a t e d t h e p r o d u c t i o n o f t h i s i t e m f i n d s some o t h e r o u t l e t s f o r t h e p r o d u c t i n o r d e r t o m a i n t a i n t h e h i g h p r o f i t mar
呂田I t i s most l i k e l y t h e f o r e i g n m a r k e t ( s ) which p o s s e s s e s t h e h i g h demands f o r t h e p r o d u c t The f i r m now s t a r t s e x p o r t i n g t h e p r o d u c t t h a t h a s l o s t i t s c o m p e t i t i v e advantage a t home t o o v e r s e a s m a r k e t ( s ) . The p r o d u c t can t h e n r e g a i n i t s advantage i n t h e o v e r s e a s m a r k e t ( s ) .
( 4 ) The n a t i v e m a n u f a c t u r e r s i n t h e f o r e i g n c o u n t r y , h o w e v e r , s o o n a f t e r l e a r n i n g how t o manufacture t h e p r o d u c t t h r o u g h t h e l i c e n s i n g agreement and/ o r p u r c h a s i n g t h e p a t e n t , may s t a r t t h e i r own p r o d u c t i o n . T h i s e n a b l e s t h e f o r e i g n c o u n t r y t o s u b s t i t u t e t h e d o m e s t i c p r o d u c t i o n f o r t h e i m p o r t o f t h e i t e m f r o m t h e advanced c o u n t r y The e x p o r t i n g f i r m i n t h e advanced c o u n t r y h a s t o l o s e agam i t s compet1 t i v e advantage o v e r t h e f o r e i g n companies The p r o d u c t a t t h i s s t a g e i s f o u n d t o b e s t a n d a r d i z e d i n t e r n a t i o n a l l y .
( 5 ) Faced w i t h t h i s l o s i n g s i t u a t i o n , t h e exportmg f i r m o f t h e advanced c o u n t r y h a s t o p r o t e c t i t s e x p o r t market I t 1 s l i k e l y t h a t i t e s t a b l i s h e s t h e p r o d u c t i o n f a c i l i t i e s withm t h e f o r e i g n m a r k e t ( s ) from where t h e p r o d u c t be s h i p p e d m o r d e r t o s a t i s f y t h e l o c a l demand
The above i l l u s t r a t i o n o f t h e s t a g e s o f !PLC can be summarized
s i m p l y a s f o l l o w s ・ ( 1 ) Domestic P r o d u c t i o n o f A d 1 f f e r e n t 1 a t e d P r o d u c t →
( 2 ) D o m e s t i c C o m p e t i t i o n w i t h O t h e r Makers → ( 3 ) E x p o r t t o F o r e i g n
Markets → ( 4 ) I m p o r t S u b s t i t u ! i o n t h r o u g h L 間 由 ig/Patent → ( 5 )
F o r e i g n D i r e c t I n v e s t m e n t For some kmd o f commod1t1es f a c e d w i t h
s e v e r e c o m p e t i t i o n o v e r s e a s , i t may b e v e r y d i f f i c u l t t o complete t h e
MNC'A Managed•[ A p p m a c h 8 9 l i f e c y c l e a s d e s c r i b e d a b o v e . R a t h e r . t h e y may s k i p some o f t h e s t a g e ( s ) o f t h e i r h f e c y c l e i n o r d e r t o c o p e w i t h t h e c o m p e t i t i o n w i t h f o r e i g n ‑made p r o d u c t s . I n such c a s e s , t h e s e q u e n c e o f busmess p a t t e r n s , i . e . , f r o m ( I ) t o ( 5 ) a b o v e , may n o t be f o l l o w e d . An a l t e r n a t i v e sequence o f b u s i n e s s p a t t e r n s would b e : ( I ) Domestic P r o d u c t i o n ー令( 2 ) Domestic C o m p e t i t i o n → ( 5 ) F o r e i g n D i r e c t I n v e s t m e n t , l e a v i n g ( 3 ) E x p o r t , and ( 4 ) I m p o r t S u b s l i t u t i o n ( L i c e n s m g / Patentmg) s t a g e s s k i p p e d . I n a l l , t h e two t y p e s o f !PLC a r e i d e n t i f i e d : ( a ) t h e !PLC w i t h f u l l s t a g e s , and ( b ) t h e !PLC w i t h s k i p p e d s t a g e s .
The B u s i n e s s Sequence m the I n t e r n a l i z a t i o n Theory
The i n t e r n a l i z a t i o n t h e o r y i s t h e t h e o r y t h a t mtends t o explam t h e r e a s o n f o r and t h e p r o c e d u r e o f reducmg t h e c o s t s which a c c r u e busmess u n i t s s c a t t e r e d when t h e MNC c o n d u c t s busmesses a l l o v e r t h e w o r l d . Rugman c l a s s i f i e s t h e c o s t s i n t o two t y p e s :
( I ) t h e r e g u l a r c o s t needed i n p r o d u c i n g g o o d s and s e r v i c e s . The r e g u l a r c o s t i n c u r r e d f o r t h e d o m e s t i c p r o d u c t i o n 1 s d e n o t e d by C . The r e g u l a r c o s t f o r t h e p r o d u c t i o n o v e r s e a s i s a l s o d e n o t e d b y C
*。( 2 ) t h e s p e c i a l c o s t which i s s u p p l e m e n t a r i l y added t o t h e r e g u l a r c o s t i n o r d e r t o t r a n s p o r t t h e goods and s e r v 1 c e s t o f o r e i g n m a r k e t ( s ) from t h e o r i g i n a l e x p o r t c o u n t r y . S p e c i f i c a l l y , t h r e e k i n d s o f s p e c i a l c o s t s a r e 1 d e n t d 1 e d :
a . E x p o r t Marketing C o s t 一 一 A f i r m may c h o o s e t o e x p o r t a s a method o f t r a n s p o r t i n g goods t o f o r e i g n m a r k e t s . I n such a c a s e , t h e e x p o r t m a r k e t i n g c o s t becomes i n t e g r a l . T h i s c o s t i s d e n o t e d b y M
本b . E n v i r o n m e n t a l , C u l t u r a l , and P o l i t i c a l C o s t A f i r m 1 s assumed t o e n c o u n t e r v a r i o u s d i f f i c u l t i e s caused by t h e d i f f e r e n c e s i n e n v i r o n m e n t s , c u l t u r e , and t h e p o h t 1 c s i n h o s t c o u n t r i e s These d i f f i c u l t i e s a r e t o c a u s e a d d i t i o n a l c o s t t o t h e MNC. T h i s k i n d o f c o s t i s d e n o t e d by A*
c . Advantage D 1 s p e r s 1 o n C o s t 一 − A f i r m may l e n d and s h a r e i t s
l i c e n s e s w i t h f o r e i g n f i r m s T h i s may expose t h e hcensmg
f i r m t o t h e r i s k o f l o s m g i t s c o m p e t i t i v e advantage t o t h e
l i c e n s e e ( s ) . The p o s s i b l e c o s t o f d i s p e r s i n g t h e c o m p e t r t i v e edge r s d e n o t e d by D
本ーI n c o n s i d e r a t i o n w i t h t h e s e c o n c e p t s o f c o s t , t h e MNCs p u r s u e a method o f t r a n s p o r t i n g goods and s e r v i c e s t o f o r e i g n markets The methods a r e e i t h e r ( I ) E x p o r t , ( 2 ) F o r e i g n D i r e c t I n v e s t m e n t , o r ( 3 ) L i c e n s i n g . The c o m p o s i t i o n o f c o s t s needed f o r e a c h o f t h e t h r e e t r a n s p o r t a t i o n methods a r e a s f o l l o w s
( I ) E x p o r t
( 2 ) F o r e i g n D i r e c t I n v e s t m e n t ( 3 ) L i c e n s i n g
C + M*
C本+ A本 C* + D
本A f r r m , a f t e r c a l c u l a t r n g t h e t o t a l c o s t o f e a c h m e t h o d , w r l l compare t h i s t o t a l c o s t w i t h t h e e x p e c t e d t o t a l r e v e n u e d e r i v e d from each m e t h o d . I n a c c o r d a n c e w r t h t h e s e r e s u l t s , t h e method w i t h t h e maximum n e t p r o f i t w i l l b e s e l e c t e d An i m p o r t a n t p o i n t , a c c o r d i n g t o Rugman, r s t h a t t h e b e s t method t o be chosen f o r t h e c o s t mmimrzmg p u r p o s e t e n d s t o v a r y o v e r t h e p e r i o d . I t i s p o s s i b l e t o comprehend t h i s v a r i a t i o n from comparing t h e amount o f a d d i t i o n a l c o s t such a s M 大 A 大 D*
Assume t h a t M *く A *く D* Then, t h e e x p o r t h a v i n g t h e minimum c o s t ( C + M 勺 w r l lb e t h e f i r s t c h o i c e , f o l l o w e d by t h e f o r e i g n d i r e c t i n v e s t m e n t ( C 本+ A 勺 a st h e s e c o n d c h o r c e , and by t h e hcensmg ( C ホ+
D 勺 a s t h e l a s t o n e . I n s h o r t , t h e p r e f e r r e d s e q u e n c e o f b u s i n e s s p a t t e r n s , accordmg t o t h e i n t e r n a l i z a t i o n t h e o r y , r s ( I ) Export ー→( 2 ) F o r e i g n D i r e c t I n v e s t m e n t ー→( 3 )L i c e n s i n g , i n t h a t o r d e r
When c o n s i d e r m g a t h e o r e t i c a l p e r s p e c t i v e , h o w e v e r , i t i s even p o s s i b l e t o e s t a b l i s h a n o t h e r p r e f e r e n t i a l sequence o f b u s i n e s s p a t t e r n s a s ( I ) E x p o r t →(3 ) L i c e n s i n g →(2 ) F o r e i g n D i r e c t I n v e s t m e n t .
I n t e g r a t i n g the Busmess Sequences i n both the T h e o r i e s
I n t h e p r e v i o u s s e c t i o n , t h e mtegnty o f observmg t h e MNCs from
two s i d e s , i e . , t h e p r o d u c t i o n / marketing a s p e c t and t h e c o s t
management a s p e c t , was d i s c u s s e d i n o r d e r t o apprehend t h e e n t i r e
a c t i v i t y o f t h e MNCs. The p r o d u c t i o n / m a r k e t i n g a p p r o a c h i s
a p p r o p n a t e l y d e s c r i b e d by t h e !PLC and t h e c o s t management
MNC'A M a n a g e d a l A p p < O ' c h 9 1 a p p r o a c h i s i d e n t i f i e d by t h e i n t e r n a l i z a t i o n t h e o r y . The f i r s t a p p r o a c h i s f o r t h e n e c e s s a r y c o n d i t i o n and t h e s e c o n d one i s f o r t h e s u f f 1 c 1 e n t c o n d i t i o n f o r t h e MNCs t o b e i d e n t i f i e d I t s h o u l d b e n o t e d a g a i n h e r e t h a t b o t h c o n d i t i o n s o u g h t t o be f u l f 1 l l e d s i m u l t a n e o u s l y m o r d e r t o a c h i e v e t h e w e l l b a l a n c e d a c t i v i t y o f t h e MNC i n t h e w o r l d m a r k e t . The s i m u l t a n e o u s f u l f 1 l l m e n t o f b o t h c o n d i t i o n s t h e n i m p l i e s t h a t t h e b u s i n e s s s e q u e n c e s s p e c i f i e d by b o t h t h e o r i e s o u g h t t o b e a l s o matched. T h i s pomt 1 s v e r y i m p o r t a n t b e c a u s e even i f , f o r e x a m p l e , t h e F o r e i g n D i r e c t I n v e s t m e n t i s chosen a s t h e b e s t b u s i n e s s p a t t e r n from t h e IPLC's s t a n d p o i n t t o f u l f i l l t h e n e c e s s a r y c o n d i l i o n , some o t h e r b u s i n e s s p a t t e r n s u c h a s t h e L i c e n s i n g might a l s o b e chosen a s t h e b e s t one from t h e I n t e r n a l i z a t i o n Theorys view i n o r d e r t o s a t i s f y t h e s u f f i c i e n t c o n d i l i o n . I n t h i s c a s e , t h e d i s c r e p a n c y o f t h e b e s t busmess p a t t e r n ( s ) f o r f u l f i l l i n g t h e c o n d i t i o n s i s l i k e l y t o r e s u l t i n some s u b o p t i m 1 z a t i o n o f t h e MNC's o r g a n i z a t i o n a l p e r f o r m a n c e . F i g u r e 1 i l l u s t r a t e s t h e f o u r p o s s i b l e c a s e s o f matching t h e n e c e s s a r y and t h e s u f f i c i e n t c o n d i t i o n s .
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and The I n t e r n a l i z a t i o n Theory
On t h e h o n z o n t a l a x i s o f F i g u r e I , two t y p e s o f b u s i n e s s s e q u e n c e a r e a r r a y e d a l o n g w i t h t h e ! P L C :
( A ) The F u l l C y c l e Type
( ! ) D o m e s t i c P r o d u c t i o n → (2 ) E x p o r t → (3 ) I m p o r t S u b s t i t u t i o n ( L i c e n s m g )→(4 ) F o r e i g n D i r e c t I n v e s t m e n t ( B ) The C y c l e S k i p Type
( ! ) D o m e s t i c P r o d u c t i o n→(4 ) F o r e i g n D i r e c t I n v e s t m e n t Along w i t h t h e v e r t i c a l a x i s , a n o t h e r s e t o f b u s i n e s s s e q u e n c e b a s e d on t h e I n t e r n a l i z a t i o n Theory i s p l a c e d
( X ) M * く A * く D
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( ! ) D o m e s t i c P r o d u c t i o n → (2 ) E x p o r t →(3 ) F o r e i g n D i r e c t I n v e s t m e n t →(4 ) L i c e n s i n g
( Y ) Mキ< D ネ く A
事Type
( ! ) D o m e s t i c P r o d u c t i o n →(2 ) E x p o r t → (3 ) L i c e n s i n g → ( 4 ) F o r e i g n D i r e c t I n v e s t m e n t
Match‑Mismatch o f B u s i n e s s P a t t e r n s
The match mismatch o f t h e b u s i n e s s p a t t e r n s f o r b o t h t h e n e c e s s a r y and t h e s u f f i c i e n t c o n d i t i o n s i s shown i n F i g u r e 2 .
The c a p i t a l M i n F i g u r e 2 i n d i c a t e s t h a t t h e b u s i n e s s p a t t e r n s f o r t h e n e c e s s a r y c o n d i t i o n and t h e s u f f i c i e n t c o n d i t i o n m a t c h . The a r r o w s drawn from t h e o r i g i n a l M ( t h e matched b u s i n e s s p a t t e r n s o f t h e d o m e s t i c p r o d u c t i o n and e x p o r t ) t o o t h e r Ms t e l l t h e s e q u e n t i a l p r o c e s s o f matched busmess p a t t e r n s The b l a n k c e l l s i n F i g u r e 2 i n d i c a t e t h a t t h e b u s i n e s s p a t t e r n s l o c a t e d i n them d o n o t m a t c h , t h e r e f o r e , t h e n e c e s s a r y c o n d i t i o n and t h e s u f f r c i e n t c o n d i t i o n s a r e n o t s i m u l t a n e o u s l y s a t i s f i e d .
I n sum, t h e f o l l o w i n g s e q u e n c e s o f b u s i n e s s p a t t e r n s a r e f o u n d t o s a t i s f y b o t h t h e n e c e s s a r y and t h e s u f f i c i e n t c o n d i t i o n s
I n t h e A X c o m b m a t i o n .
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I n t h e A Y c o m b i n a t i o n ,
( ! ) E x p o r t → L i c e n s i n g → F o r e i g n D r r e c t I n v e s t m e n t
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