Date of Award
Winter 1988
Project Type
Dissertation
Program or Major
Economics
Degree Name
Doctor of Philosophy
First Advisor
Marc W Herold
Abstract
This thesis employs both aggregate data and a dissaggregated sample of 135 non-U.S. multinational enterprises to analyze the extent of direct foreign investment (DFI) in United States manufacturing since 1900, its characteristics and causes. This research revealed that: (1) DFI originates primarily from other developed capitalist countries, (2) most DFI is relatively recent, accelerating markedly after 1970, (3) from the perspective of relative interpenetration of DFI, U.S. imperial power versus its major trading rivals has waned since 1970, (4) there is a strong tendency for the parent firm to penetrate the market through acquisitions of existing U.S. firms, and (5) that, normally, the investor acquires 100% control of its investment.
Mainstream theories of DFI, which evolved from ideas advanced in the areas of marketing and industrial organization, argue that market imperfections create the firm's decision to undertake DFI. This view is seen as lacking due to its failure to account for the inherent advantages of investment over trade for servicing foreign markets. Additionally, this thesis rejects the view of many radicals in the U.S. concerning the nature of modern capitalist production and accumulation. Specifically, it is argued that monopoly capital theory is unable to explain the growing interpenetration of productive capital. Instead of solidified monopoly and perpetual stagnation, this thesis presents a dialectical view of competition and monopoly whereby the competitive interaction of capital continually undermines the old monopoly positions while creating new elements of monopoly (at a higher level) as the international concentration and centralization of capital proceeds.
This thesis also illustrates that the growth of direct foreign investment in the U.S. is tied to the transition from a long wave of expansion to a long wave of stagnation in the world capitalist economy. This transition to stagnation in the early 1970s produced a heightening of the forces of competition which is increasingly expressed through the internationalization of the circuit of productive capital. Moreover, this movement of capital is seen as an important aspect in explaining the processes by which a foundation for a new social structure of accumulation is being erected.
Recommended Citation
Widener, Steven Louis, "An historical, theoretical and empirical analysis of direct foreign investment in the United States during the twentieth century" (1988). Doctoral Dissertations. 1568.
https://scholars.unh.edu/dissertation/1568