4.9.3 Technology
MNEs typically possess state-of-the-art technology in their particular industry. Potential host countries often lack the resources for research and development to acquire the latest technology, so they may acquire it from MNEs either by licensing or by FDI. Licensing may be the preferred option for a host country, but the risk of creating future competitors for the home country often rules it out. However, FDI at least introduces the new technology to the host country, although the dissemination of the technology will be slower than it would be with licensing.
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