Research of possible role of urban marketing in attracting foreign direct investment (FDI) in cities of Bosnia and Herzegovina

Paliaga, Marko and Fočo, Almin and Barilović, Zlatko (2012) Research of possible role of urban marketing in attracting foreign direct investment (FDI) in cities of Bosnia and Herzegovina. In: Marketing challenges in new economy. Sveučilište Jurja Dobrile u Puli. ISBN 978-953-7498-57-3

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Sažetak

Over the last decade, in addition to economic, demographic and urban fabric changes reflecting on the behaviour of cities as local governments and centres of economic and political processes, we have been affected by the process of globalisation and an accelerated process of urbanization. Globalisation now also includes political, social, economic and geographical dimensions. Every developed economic system has to pay attention to the fact that it cannot exist as a single unit without a relationship with the global environment. Due to the process of economic globalisation, each stimulus or hindrance in business operations of any relevant economy may cause stimuli or hindrances in some other branch of economy. The process of globalisation has brought about a connection of commercial, technological, social and political structures worldwide. In the whole complex process, each participant is important because globalisation made it possible for each (no matter how small and local) participant to take part and trade with the economy of a country he could not even locate on a map. Globalisation, internationalization and regionalisation of the entire world economy have made direct investment promotion very interesting for governments and city administrations. Direct foreign investment has become a part of clear city development strategy with all necessary requests fulfilled and with a clear local strategy of promoting and attracting investors. In this regard, marketing philosophy and marketing tools may be, and are, one of the fundamental backbones of efficient realisation of city development strategies. It is therefore indispensable, in addition to fulfilling the fundamental preconditions, to use all available marketing tools (at both national and local levels) in order to achieve competitive advantages. According to the definition of the International Monetary Fund (Babić, Pufnik, Stučka, 2001) foreign direct investment (FDI) occurs when a non-resident investor owns 10 percent or more equity share of a resident's business entity. The main purpose of FDI is active participation of foreign investors in the process of company management, which makes it different from other types of inflow of foreign capital. To take advantage of FDI benefits, it is not indispensable to own a company in another country. Advantages may also be acquired through export or licence agreements with a domestic company. Nevertheless, FDI enables considerable savings by means of internalization of transactions, which could not be the case with export of finished products or licence granting. Internalization occurs because there is no market for some specific advantages, so that they can only be placed internally - within the company. In such a case, foreign direct investment becomes the substitute for the insufficiently developed financial market. One of the most widespread theories explaining the reasons for FDI has been developed by Dunning (1988) in his OLI theory that explains the reasons and motives of foreign investors through three sets of advantages; O - ownership advantages, as a result of ownership of specific (intangible) assets; L - location, geographical and economic advantages of a given location, and I - internalization, when benefits of launching own production exceed the benefits of selling the licence. In this matter, location factors play the decisive role because of rich natural resources, developed infrastructure, favourable price of workforce in relation to its quality, abundance and quality of other production and business factors (transportation expenses, market access) and different forms of administrative measures (customs, quotas, investment promotion measures, etc.). In any case, whatever the reasons for FDI, they eventually always reflect the investors' aspiration to increase profits and extend the influence of the company.

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Tip objekta:	Dio knjige
Mentor:	NIJE ODREĐENO
Dodatne informacije:	e-book
Teme:	3 Društvene znanosti > 33 Ekonomija. Ekonomska znanost > 339 Trgovina. Međunarodni gospodarski odnosi. Svjetsko gospodarstvo > 339.1 Opća pitanja trgovine. Tržište > 339.138 Marketing
Odjeli:	Odjel za ekonomiju i turizam "Dr. Mijo Mirković"
Datum pohrane:	04 Jul 2013 06:21
Zadnja promjena:	04 Jul 2013 06:21
URI:	http://eknjiznica.unipu.hr/id/eprint/2229

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