The Eclectic Paradigm or OLI Framework - Simplest Explanation Ever

The video tutorial introduces the concept of Foreign Direct Investment (FDI) and the Oli framework, which is also known as the eclectic paradigm. It explains the two forms of FDI: Greenfield Investments and mergers and acquisitions. The Oli framework is detailed, highlighting the three key advantages needed for successful FDI: ownership, location, and internalisation. Each advantage is explored in depth, discussing how companies can leverage these to gain competitive advantages in foreign markets. The tutorial concludes with a graphical representation of the Oli framework, aiding in understanding strategic decision-making for FDI.

Explain the difference between Greenfield Investments and mergers and acquisitions.

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What is the Ecliptic paradigm and how does it relate to foreign direct investment?

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What are the three advantages that a company needs to derive when engaging in foreign direct investment according to the Oli framework?

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What factors should a company consider regarding ownership when planning to expand overseas?

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What are some potential disadvantages a company might face when venturing into a foreign market?

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What questions should company management ask themselves to assess their readiness for foreign direct investment?

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How can location provide a competitive advantage for a company looking to invest in a foreign market?

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Discuss the importance of internalisation in the context of foreign direct investment.

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In what scenarios might a company choose to export rather than engage in foreign direct investment?

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How does the Oli framework guide companies in their decision-making process for foreign investments?

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