Outward Foreign Direct Investments: Experience of Polish Companies

Outward Foreign Direct Investments: Experience of Polish Companies

Anetta Kuna-Marszałek (University of Lodz, Poland) and Agnieszka Kłysik-Uryszek (University of Lodz, Poland)
DOI: 10.4018/978-1-5225-0451-1.ch012
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Abstract

Dynamic changes that have taken place on Polish, European and global markets for the last two decades shifted significantly the conditions in which companies operate. Globalization, liberalization of capital flows, participation in the European Union not only increased competition on Polish market, but radically boosted the competitive potential of Polish firms. This, in turn resulted in growing interest in expanding the activity on international scale in the form of Outward Foreign Direct Investments (OFDI). Therefore, the aim of the chapter is to discuss the most important stimuli, which impact competitive potential of Polish companies and increase their interest in foreign activity. Moreover, theoretical background of company's internationalisation are presented, as well as the scale and structure of Polish OFDI and incentives provided by Polish institutions.
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Background

The process of internationalisation of enterprises is defined in various ways by scholars and academics. Mostly, the term “internationalisation” is connected with the expansion of enterprises to foreign markets, which is closely linked to progressing globalisation, including liberalisation of trade and capital flows and technological progress. It depends, inter alia, on the motivation or propensity of economic operators to go international and results from the engagement of their own resources or getting involved in various forms of cooperation with foreign partners. Thus, Wind, Douglas, and Perlmutter (1973) stress that internationalisation is a process where the specific conduct of enterprises is connected with subsequent stages in the evolution of international operations. Johanson and Vahlne (1977), Johanson and Mattson (1993), and Calof and Beamish (1995) understand internationalisation as a process of increasing international involvement and the adjustment of a company’s operations to the specificity of the international environment.

Internationalisation is discussed from different angles, e.g., the theory of organisation, strategic management, international management, foreign trade, or regional development. Nowadays, definitions also take into account the relevance of R&D activities undertaken abroad. The approach is visible in Hollensen (2011, p. 41), who claims that one may speak of internationalisation when a company expands its production, sales, R&D, and other activities to foreign markets.

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