Location Choice and Agglomeration Mechanism of Foreign Direct Investment

FDI is more heaped up on space comparing with other modes of production, gathering together is the end-result of the great majority of overseas-funded enterprises. By building up an oligopoly output competition model consists of multinational enterprises and the host state enterprises, this paper analyzes the location choice behavior of direct investments from multinational enterprises and the mechanism of FDI agglomeration in host country. Agglomeration of FDI is attained by market jams and market enlarges the two kinds of contrary strength.