The behavior of multinational corporations and their affiliates, and the impact of foreign direct investment on host economics, vary between countries and industries in a systematic way. MNCs select their strategies depending on the characteristics of their technologies and products, as well as the characteristics and policies of the host countries. Some host country governments try simultaneously to influence behavior of the foreign MNC"s operating in their territory, either directly through regulations, or indirectly, but affecting the environment in which the MNCs operate. The effects of (FDI) on the host economy are determined by this intricate interplay of firm and host country strategies. This book summarizes more than a decade of research aiming to understand this interplay.