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Studies & Degrees in Foreign Direct Investment

Foreign direct investment (FDI) is investment by which a company or person from one country obtains a lasting interest in a business in another country. Eurostat defines it as a resident entity in one economy seeking a lasting interest in an enterprise resident in another economy, which implies a long-term relationship and significant influence on management. The statistical threshold is ownership of 10% or more of the ordinary shares or voting rights. The US Bureau of Economic Analysis uses the same 10 percent rule.

The International Monetary Fund (IMF) contrasts this with portfolio investment, in which an investor buys shares or bonds without taking part in running the company. In direct investment, the intention to stay and to influence management is what counts.

What students learn

FDI is a topic within international economics and international business, not a traditional degree of its own. Courses that deal with it cover:

  • why companies invest abroad instead of exporting, and how multinational enterprises organise production across countries
  • the forms of investment: greenfield investment, in which the investor funds a new factory, distribution facility or shop, and brownfield investment, in which the investor acquires existing facilities and operations
  • effects on the host country: jobs, tax revenue, technology and competition for local firms
  • policy: investment promotion, special economic zones, tax incentives, screening of foreign investors and investment treaties
  • data and methods: balance of payments statistics, FDI flows and positions, and econometrics
  • country risk, international tax and the law of cross-border mergers and acquisitions

Students therefore need a base in economics and statistics, and usually add law, finance or the politics of a region.

Qualifications and levels

  • Bachelor's degree. FDI appears as a course or module in bachelor's degrees in economics, international business or international relations. A full bachelor's degree with this name is unusual.
  • Master's degree. Specialisation normally takes place here: master's degrees in international economics, international business, development policy or public policy with courses on investment policy, and law degrees focused on international investment law.
  • Doctorate. Research on multinational firms and investment flows is done in PhD programmes in economics or international business.
  • Short courses. International organisations and investment promotion agencies train civil servants and professionals in investment promotion and investment statistics. These courses lead to a certificate, not a degree.

Where to study foreign direct investment

SpainExchange lists one active school for this subject: KDI School of Public Policy and Management in South Korea. It is a graduate school of public policy linked to the Korea Development Institute, a Korean think tank, and all its classes are taught in English. Its website gives a campus address in Sejong and currently lists six master's programmes by their abbreviations (MPP, MDP, MIPD, MPM, MDS and MPPM) and a PhD. None of them carries the name foreign direct investment, so applicants should ask the school which of its current programmes and courses deal with investment policy.

Because dedicated programmes are rare, most students reach the topic through a broader degree. When comparing master's degrees in international economics, international business or development policy, check whether the curriculum includes courses on multinational enterprises, investment policy and international investment law, and whether the school has links with investment agencies, ministries or international organisations for internships.

Careers

Knowledge of FDI is used on both sides of an investment. On the public side, graduates work for investment promotion agencies, ministries of economy and trade, central banks, statistical offices and international organisations. Many governments run investment promotion programmes to attract foreign companies, according to the IMF; Spain's agency, for example, is ICEX-Invest in Spain. On the private side, graduates work in the strategy and expansion departments of multinational companies, in consultancies that advise on where to locate a plant or office, in law firms and in banks.

Typical roles are investment analyst, economist, policy adviser, location consultant and business development manager. For economists in the United States, the Bureau of Labor Statistics gives a master's degree as the typical entry-level education, although some positions, mainly in government, are open to holders of a bachelor's degree, and it projects employment to grow 5 percent from 2025 to 2035.

Frequently asked questions

What is the difference between foreign direct investment and portfolio investment?

A direct investor seeks a lasting interest and influence over the management of a company abroad, usually with at least 10% of the shares or voting rights. A portfolio investor buys shares or bonds without taking part in running the company.

Can I take a degree in foreign direct investment?

Rarely under that name. The subject is normally studied as part of a degree in international economics, international business, development policy or international law, most often at master's level.

What do greenfield and brownfield investment mean?

In a greenfield investment the investor pays for new facilities, such as a factory or a shop. In a brownfield investment the investor buys or takes over an existing local company with its facilities and operations.