Colonialism in Foreign Subsidiaries: Lessons from Japanese Investment in Thailand

Abstract

FOREIGN DIRECT INVESTMENT means the planting in one country of a package of capital, technology, and management by a company based in another country. The package is usually carefully wrapped according to the investing company's criteria and methods of good business. When the countries involved are roughly equal in the stage of economic development and belong to the same culture, interpenetrations by exchanges of foreign direct create few serious problems. Even le ddfi amdricain to Europe has only turned out to be amusing rhetoric. Not so, however, when there are cultural differences and economic differentials between source and host countries of foreign direct investment. The relations between investing companies from developed countries and the government and people of host countries are weighted in favor of the companies. The fact that the host countries must first prepare the right kind of investment climate for foreign companies is the most telling indication that the hosts start from a position of