After years of limiting foreign direct investment (FDI), governments in developing countries are now focusing on attracting outside investors, spending large sums of money to attract foreign companies to their country. In Brazil, for example, competing to attract foreign direct investment is estimated to have cost around $300,000 per job created. Say no to plagiarism. Get a tailor-made essay on "Why Violent Video Games Shouldn't Be Banned"? Get an original essayThese changes are valuable because multinational corporations (MNCs) are believed to bring not only employment and capital, but also new skills and technological abilities to the domestic market. companies. Such an advantage for the company and the country is to flow out of the subsidiaries of multinational companies into domestic companies as "spillovers". But the evidence for the positive spillover effects expected by both policymakers and theorists is inconclusive. This summarizes that we need to reconsider the situations in which FDI can and does provide spillovers, and policy continues to pursue practices that encourage such effects. For example, multinational information technology companies in India, such as Texas Instruments and Oracle, send their human resources to the United States for training and upskilling in research and development. Domestic companies then use these skills when workers change jobs. The old model approach: The key propositions of the electric paradigm: Ownership-specific advantages (O): Localization advantages (L) Internalization advantages (I) Internationalization theory focuses on the imperfection of intermediate workers markets products. Two main types of product markets are the knowledge flow linking research and development (R&D) to manufacturing, and the component and raw material flows. Internationalization occurs only when the company focuses more on reaping benefits and maximizing profits by reducing costs. In today's growing economy, every company is aiming for this and these lead to foreign direct investment. Foreign direct investment can be in two forms: resource-seeking investments and market-seeking investments.1. Ownership: There are many forms of ownership advantages (O) that the multinational can transfer within the multinational enterprise located in various parts of the company at relatively low cost. There are few assets owned by the company that can constitute an additional advantage over other competitors. Companies base their competitive factors on the internationalization process. Some of them are monopolistic advantages that the company in its home country has in the form of privileges, such as scarce natural resources, patent rights, branding, innovation activities, technology and knowledge. These benefits must have some variation and particularity and give the international firm the choice to compete internationally profitably, as well as be transferable between countries and within the firm.2. Location: The company must use some foreign (L) factors in connection with its ingrained national core competencies or, as Dunning defines the advantages of ownership. The location advantages of various countries are critical in determining which will become host countries for multinational companies. Ultimately, the attractiveness of various location factors may change over time so that a host country may to some extent alter its competitive advantage as a location for foreign direct investment. We can differentiate the factors by including them.”