Theories of international production

Theories of international production explain why companies operate in multiple countries. Factors include seeking cheaper labor or materials, accessing new markets to sell products, or benefiting from specialized skills and technology available elsewhere. For example, a company might produce goods in a country with lower wages to reduce costs or set up factories close to big markets. These theories help understand how businesses decide where to locate parts of their production process across the globe, balancing costs, resources, and market access to maximize efficiency and profitability.