| Abstract: | This paper analyzes data on foreign direct investment (FDI) by Korean firms in the light of eight propositions drawn from the literature on FDI which includes both the theoretical and empirical findings of studies on FDI by Third World Multinational Corporations (MNCs). The data concern FDI in manufacturing, natural resources, construction, banking and other industries. The propositions examined include the nature of ownership advantages, the trade-orientation of FDI, and motivations behind the overseas expansion of Korean banks. In addition, the geographical distribution and ownership patterns which arise as a result of these variables are also examined. The findings are generally consistent with many of those in previous theoretical and empirical studies and suggest that an eclectic approach, incorporating many explanatory variables, could adequately explain the patterns in Korean outward FDI.The authors are from School of Business Administration, The University of Michigan and School of Business Administration, Georgetown University, respectively. They gratefully acknowledge the valuable suggestions by Professors Sang Kee Min of Seoul National University and Adrian E. Tschoegl of The University of Michigan. They also acknowledge the cooperation of officers in the Bank of Korea, Korea. |
