ABSTRACT
Why do multinational enterprises (MNEs) undertake foreign direct investment (FDI)? The number of MNEs that undertake FDI is increasing. The number of MNEs worldwide was approximately 7,000 in 1970, and increased to approximately 82,000 in 2009 (UNCTAD, 2009). The number of countries that receive FDI flow was 121 in 1970 and 201 in 2014 (UNCTAD, 2015). Since the 1970s, the world economy has witnessed the participation of the developing countries in East Asia, the transition economies in Central and Eastern Europe, and the emerging economies such as Brazil, Russia, India, and China (BRIC). These countries have not only become major recipients of FDI, but have also become breeding grounds for new multinationals that undertake significant outward FDI.
