An Analysis of TNCs’ Investment Motives and Their Impact on Host Countries’ Industrial Security

Abstract

Since there are differences between transnational corporations’ investment motives and host countries’ goals of attracting investment, the actual investment behaviors of transnational corporations may cause negative impacts on host countries’ industrial security. Based on the non-cooperative dynamic game model between transnational corporations and host countries, it is not difficult to find that host countries can take certain encouraging or restraint mechanism, namely ‘positive institutional arrangement’ to force transnational corporations to abide by the arrangement in the process of investment in order to better maintain industrial security.