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One surprising development in the growth of multinational businesses and international trade is the large and growing amount of intra-industry direct foreign investment. Intra-industry direct foreign investment is the phenomenon whereby multinationals from two countries have overseas manufacturing operations in each other s countries. The phenomenon is surprising because it contradicts the notion that some countries are technology exporters and others merely receivers, as well as challenging the idea of the existence of an international division of labour. It suggests that international...