Taiwanese FDI in Europe: Development of a theoretical framework and empirical research into FDI decision-making and issues encountered by Taiwanese investors in Europe
Date Issued
2005
Date
2005
Author(s)
Hiesboeck, Dr. Martin
DOI
en-US
Abstract
The present paper looks at the available theories on internationalization in order to define the FDI decision strategy of Taiwanese firms, exploring the traditional route from transaction-cost based decisions to evolutionary and strategic models, to business networks and comprehensive SME internationalization models. The author sets out to develop a rudimentary FDI theory for Taiwanese firms, the majority of which are SMEs in technology-intensive industries and rely on extensive business networks.
Based on a broad sample of over 700 interviews, we find that in their FDI decision, the majority of firms focus on network-related aspects. Firms are constrained by those networks and the personal relationship embedded therein. Human resource management is a crucial issue in Taiwanese FDI, directing both the intensity and location of engagement in foreign markets. The study finds that safety of persons and assets, logistics and infrastructure are big concerns, while corporate tax rates and special incentices play a less important role than host governments hold true.
Furthermore, the paper seeks to shed light on the reasons for the lack of Taiwanese FDI in Europe, in particular during the European FDI boom in the 1990ies. We find these reasons to be the high level of embeddedness in existing networks and associated resource constraints of SMEs, including also a strong focus on personal relationships. Taiwan’s strong ties (personal and economic) with the US and China, combined with a general weakness in the triadic link between East Asia and Europe are given due consideration.
Subjects
對外直接投資
歐洲
中小企業
投資決策
台商
FDI
Foreign Direct Investment
Taiwan
Europe
Asia
SME Internationalization
Investment Decision
SDGs
Type
other
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