Dunning’s Eclectic Paradigm (CAVUSGIL‚ 2010) Dunning’s Eclectic Paradigm Professor John Dunning proposed the eclectic paradigm as a framework for determining the extent and pattern of the value-chain operations that companies own abroad. Dunning draws from various theoretical perspectives‚ including the comparative advantage and the factor proportions‚ monopolistic advantage‚ and internalization advantage theories. Let’s use a real firm to illustrate the eclectic paradigm. The Aluminum Corporation
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Summarise Dunnings Eclectic Paradigm. How useful is it as a theory of why companies choose to become multinationals? What are its main strengths and weaknesses? - A theory explaining why firms choose to expand internationally. Not so much a theoretical model giving a “perfect” example‚ more a theory attempting to explain the way it actually is now. A firm will expand overseas when: Ownershsip specific advantages are not possessed by competing firms of other nationalities.. - Knowledge
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TOWARD AN ECLECTIC THEORY OF INTERNATIONAL PRODUCTION: SOME EMPIRICAL TESTS JOHN H. DUNNING ’ University of Reading I Abstract. This paper first sets out the main features of the eclectic theory of international production and then seeks to evaluate its significance of ownership- and location-specific variables in explaining the industrial pattern and geographical distribution of the sales of U S . affiliates in fourteen manufacturing industries in seven countries in 1970. e lr !. V
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2.3.1 Components of Dunning’ OLI Essentially‚ the eclectic paradigm is considered as a relatively simple and comprehensive theory. It states that the foreign production undertaken by MNEs is realized by the combination of three variables: ownership‚ location and internalization advantages. First‚ the ownership advantage includes some proprietary rights or intangible asset‚ advantageous common governance and other institutional assets (Dunning and Lundan‚ 2008). Ownership advantage includes aspects
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INTRODUCTION It is true of everything that the first steps ate both the most important and the most difficult. To begin with‚ theorization consists of a set of definitions of concepts. The basic concepts underlying the eclectic theory of the multinational enterprise (MNE)(1) are currently being criticized by the internalization theorists(2) in that the ’ownership advantage’ is ’double counting‚’ that is‚ the internalization and location factors are necessary and sufficient to explain the existence
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Reconciling internalization theory and the eclectic paradigm ! ∀ # ∃ % &∋∋( ))%∗∃∗+ ∀ ‚−− .−/ − & ∀ # . 0 1 ∀ 0 0 ‚! & 0& ! ∋ 2 3 ∀ 4 3 & #
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Life of J. H. Dunning John Harry Dunning‚ OBE (June 26‚ 1927 – January 29‚ 2009) was a British economist. He researched the economics of international direct investment and the multinational enterprise from the 1950s until his death.[1] In the 1980s‚ he published the eclectic paradigm or OLI-Model/Framework as further development on the theory of internalization. Dunning died on January 29‚ 2009‚ after a yearlong battle with cancer John Dunning was born in Sandy‚ Bedfordshire on June 26‚ 1927. At
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A BRIEF OVERVIEW OF THE ECLECTIC APPROACH BY: Tavane Brooks-Barrett WHAT IS THE ECLECTC APPROACH? The eclectic approach is the label given to a teacher’s use of techniques and activities from a range of teaching approaches and methodologies. HISTORY OF THE ECLECTIC APPROACH The eclectic approach was proposed as a reaction to the profusion of teaching methods in the 1970’s and 1980’s. Eclecticism was first recorded to have been practiced by a group of ancient Greek and Roman philosophers who
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Business Review 9 (2000) 163–190 www.elsevier.com/locate/ibusrev The eclectic paradigm as an envelope for economic and business theories of MNE activity John H. Dunning Reading University‚ UK and Rutgers University‚ USA Abstract This paper updates some of the author’s thinking on the eclectic paradigm of international production‚ and relates it to a number of mainstream‚ but context-specific economic and business theories. It suggests that by dynamizing the paradigm‚ and widening it to embrace
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domestic industry shift production overseas regardless of the tradability of output. To explain this‚ we now move on to Dunning’s eclectic paradigm. This theory offers a framework through which it is possible to identify and evaluate the significance of factors influencing both the initial act of overseas operations by firms and the growth of such operations. Dunning discusses that in order for firms of one nationality to successfully compete against firms in a different nation‚ they must possess
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