Liability of foreignness refers to the internalization advantages that make it desirable to produce a good or service in-house.

Question

Quizplus · Accepted Answer

Liability of foreignness actually refers to the additional costs and disadvantages that international firms encounter while operating in a foreign market, such as unfamiliar legal systems, cultural differences, language barriers, and difficulties in establishing relationships with local suppliers, customers, and regulators. These liabilities can make it harder for foreign firms to compete with local rivals and reduce their profitability.

Liability of Foreignness Refers to the Internalization Advantages That Make