n. The result may be the displacement of local entrepreneurs and entrepreneurial drive or the bidding up of prices without additional output. Such trade unions argue, for example, that by their ability to raise funds in various countries, MNEs can reduce their capital cost relative to that of local companies and apply the savings either to attract the best personnel or to entice customers froThe mere existence of resources in a country is no guarantee they will contribute to output. Multinational enterprises (MNEs) may enable idle resources to be used. Oil production for instance, requires not only the presence of underground deposits but also the knowledge of how to find them and the capital equipment to bring the oil to the surface. Production is useless without markets and transportation facilities, which an international investor may be able to supply. Access to foreign markets, particularly the investor's home market, may be particularly important to developing countries that lack the knowledge and resources necessary to sell there. Additionally, another less tangible aspect of Foreign Direct Investment (FDI) is greater resource utilization. Through exposure to new consumer products, the local labor force may develop new wants, which could encourage them to work longer and harder to acquire the additional goods and services.

MNEs' upgrading of resources may be brought about through educating local personnel to utilize equipment, technology, and modern production methods. Even such seemingly minor programs as those promoting on-the-job safety may result in a reduction of lost worker time and machine downtime. The transference of work skills increases efficiency, thereby freeing time for other activities. Further, additional competition may force existing companies to become more efficient.

Some trade unions have claimed that there are examples of MNEs making investments, which domestic companies otherwise would have undertaken. The result may be the displacement of local entrepreneurs and entrepreneurial drive or the bidding up of prices without additional output. Such trade unions argue, for example, that by their ability to raise funds in various countries, MNEs can reduce their capital cost relative to that of local companies and apply the savings either to attract the best personnel or to entice customers from

nsportation facilities, which an international investor may be able to supply. Access to foreign markets, particularly the investor's home market, may be particularly important to developing countries that lack the knowledge and resources necessary to sell there. Additionally, another less tangible aspect of Foreign Direct Investment (FDI) is greater resource utilization. Through exposure to new consumer products, the local labor force may develop new wants, which could encourage them to work longer and harder to acquire the additional goods and services.

MNEs' upgrading of resources may be brought about through educating local personnel to utilize equipment, technology, and modern production methods. Even such seemingly minor programs as those promoting on-the-job safety may result in a reduction of lost worker time and machine downtime. The transference of work skills increases efficiency, thereby freeing time for other activities. Further, additional competition may force existing companies to become more efficient.

Some trade unions have claimed that there are examples of MNEs making investments, which domestic companies otherwise would have undertaken. The result may be the displacement of local entrepreneurs and entrepreneurial drive or the bidding up of prices without additional output. Such trade unions argue, for example, that by their ability to raise funds in various countries, MNEs can reduce their capital cost relative to that of local companies and apply the savings either to attract the best personnel or to entice customers fro

new consumer products, the local labor force may develop new wants, which could encourage them to work longer and harder to acquire the additional goods and services.

MNEs' upgrading of resources may be brought about through educating local personnel to utilize equipment, technology, and modern production methods. Even such seemingly minor programs as those promoting on-the-job safety may result in a reduction of lost worker time and machine downtime. The transference of work skills increases efficiency, thereby freeing time for other activities. Further, additional competition may force existing companies to become more efficient.

Some trade unions have claimed that there are examples of MNEs making investments, which domestic companies otherwise would have undertaken. The result may be the displacement of local entrepreneurs and entrepreneurial drive or the bidding up of prices without additional output. Such trade unions argue, for example, that by their ability to raise funds in various countries, MNEs can reduce their capital cost relative to that of local companies and apply the savings either to attract the best personnel or to entice customers fro

ay result in a reduction of lost worker time and machine downtime. The transference of work skills increases efficiency, thereby freeing time for other activities. Further, additional competition may force existing companies to become more efficient.

Some trade unions have claimed that there are examples of MNEs making investments, which domestic companies otherwise would have undertaken. The result may be the displacement of local entrepreneurs and entrepreneurial drive or the bidding up of prices without additional output. Such trade unions argue, for example, that by their ability to raise funds in various countries, MNEs can reduce their capital cost relative to that of local companies and apply the savings either to attract the best personnel or to entice customers fro

n. The result may be the displacement of local entrepreneurs and entrepreneurial drive or the bidding up of prices without additional output. Such trade unions argue, for example, that by their ability to raise funds in various countries, MNEs can reduce their capital cost relative to that of local companies and apply the savings either to attract the best personnel or to entice customers from competitors through greater promotional efforts. However, evidence for these arguments is inconclusive. MNEs frequently do pay higher salaries and spend more on promotion than local companies do, but it is uncertain whether these differences result from external advantages or represent required added costs of attracting workers and customers when entering new markets. Added compensation and promotion costs may negate any external cuts advantages obtained from access to cheaper foreign capital. Additionally, in many instances, the local competition also has access to that cheaper capital.

Trade unions also contend that FDI destroys local entrepreneurial drive, which has an important effect on development. Since the expectation of success is necessary for the inauguration of entrepreneurial activity, the collapse of small cottage industries in the face of MNEs consolidation efforts may make the local population feel incapable of competing. However, the presence of MNEs sometimes may increase the number of local companies in host-countries markets since MNEs serve as a role model that local talent can emulate. Further, an MNE often buy many services, goods, and supplies locally and thus may stimulate local entrepreneurship. For example, automobile producers typically add less than half the value of an automobile at the factory, buying the remaining parts, subassemblies, and modules from suppliers. In fact, true entrepreneurs will find areas in which to compete; consequently, in any country there are success stories that can be emulated.

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