The eclectic theory states that a company will begin by exporting its products and later undertake foreign direct investment as a product moves through its life cycle.

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The eclectic theory, also known as the OLI framework, suggests that foreign direct investment is driven by three factors: ownership advantages, location advantages, and internalization advantages. It does not necessarily propose a sequential progression from exporting to foreign direct investment as a product matures.

The Eclectic Theory States That a Company Will Begin by Exporting