Paper Title
Entry Mode and Quality Introduction of FDI Firms

Abstract
This paper employs a three-stage game to investigate the optimal entry mode and quality incremental introduction of MNEs when it introduces a vertical product. The results show that, with vertical product, a higher number of domestic firms lead to an introduction of higher quality incremental when domestic quality is sufficiently low. On the contrary, for a sufficiently high domestic quality, he foreign quality incremental exhibits a concavely change in the number of domestic firms. It also shows that the foreign firm with direct entry mode introduces lower quality incremental than which with acquisition mode when the domestic quality is sufficiently high. However, the foreign firm always prefers to enter the domestic market with direct entry mode. Index Terms - Acquisition, entry mode, quality transfer, three stage game