Internationalisation speed and MNE performance: A study of the market-seeking expansion of retail MNEs

Existing research is divided on whether firms that rapidly expand their overseas operations perform better than firms that internationalize slowly. Drawing on Penrose’s theory of the growth of the firm we argue that the positive effects of rapid internationalization give way to negative effects with increasing internationalization speed, leading to an inverted U-shaped association between internationalization speed and firm performance. We analyse the market-seeking expansion of 110 retailers over a 10-year period (2003–2012) and find support for a curvilinear relationship between internationalization speed and firm performance that is moderated by the geographic scope of firms’ internationalization path and firms’ international experience. Our study contributes to resolving conflicting views on the link between internationalization speed and firm performance

Home country supportiveness/unfavorableness and outward foreign direct investment from China

What drives the outward foreign direct investments (OFDIs) by emerging market firms (EMFs)? Drawing on a strategy tripod framework, this article proposes a theoretical model to predict OFDI by EMFs from China. Specifically, we use institution- and industry-based views to examine two facets of home country environment, namely the supportiveness from home government and unfavorableness from home industry, as important determinants of OFDI, and compare the relative strength of these effects. Further, we use resource-based view to argue that the effect of the home country environment is contingent on the international experience portfolios of EMFs

Organizational innovation in the multinational enterprise: internalization theory and business history

This article engages in a methodological experiment by using historical evidence to challenge a common misperception about internalization theory. The theory has often been criticized for maintaining that it assumes a hierarchically organized MNE based on knowledge flowing from the home country. This is not an accurate description of how global firms operate in recent decades, but this article shows it has never been true historically. Using longitudinal data on individual firms from the nineteenth century onwards, it reveals evidence of how entrepreneurs and firms with multinational activity faced with market imperfections changed the design of their headquarters and their organizational structures

Exploring perceptions of advertising ethics: an informant-derived approach

Whilst considerable research exists on determining consumer responses to pre-determined statements within numerous ad ethics contexts, our understanding of consumer thoughts regarding ad ethics in general remains lacking. The purpose of our study therefore is to provide a first illustration of an emic and informant-based derivation of perceived ad ethics. The authors use multi-dimensional scaling as an approach enabling the emic, or locally derived deconstruction of perceived ad ethics. Given recent calls to develop our understanding of ad ethics in different cultural contexts, and in particular within the Middle East and North Africa (MENA) region, we use Lebanon—the most ethically charged advertising environment within MENA—as an illustrative context for our study. Results confirm the multi-faceted and pluralistic nature of ad ethics as comprising a number of dimensional themes already salient in the existing literature but in addition, we also find evidence for a bipolar relationship between individual themes. The specific pattern of inductively derived relationships is culturally bound. Implications of the findings are discussed, followed by limitations of the study and recommendations for further research

Regulator Vulnerabilities to Political Pressure and Political Tie Intensity: The Moderating Effects of Regulatory and Political Distance

This study applies the institution-based view and neo-institutional theory in addressing how managerial perceptions of regulator vulnerabilities to political pressure, and institutional distance, influence intensification of political ties. Our analysis of 181 wholly owned foreign subsidiary (WOFSs) operating in the Philippines suggests that managerial perceptions of regulator vulnerability to political pressures positively enhance the intensification of political ties. Our results also reveal that regulatory distance and, more importantly, the simultaneous presence of political and regulatory distance diminish the positive relationship between managerial perceptions of regulator vulnerability to political pressures and a WOFS’s propensity to enhance the intensification of political ties. Managerial implications and future research directions are discusse

Multinationality and performance literature: a critical review and future research agenda

The literature on the relationship between the degree of multinationality (M) and performance (P) in the context of multinational enterprises (MNEs) has attracted a large volume of research in the past 50 years. Yet, the theoretical foundations and the empirical conclusions concerning the nature of M–P relationship vary greatly, thus call for a critical review and assessment. We examine 135 articles in 39 leading scholarly journals and classic books published during the period 1960–2015. We use an inductive approach and a qualitative content analysis methodology for our comprehensive and critical review of the literature. We incorporate international business, finance, and accounting perspectives in our analysis. We review the conceptualization and measurement of M, P, the findings on M–P relationships, methodologies, and geographic focus. We identify six key inconsistencies in the existing research, which cause ambiguity in the relevant findings. We make eight recommendations for future research to address these inconsistencies. Thus, our study contributes to the central debate in this research field

Political behavior, social responsibility, and perceived corruption: a structuration perspective

This study unites the three lenses – political behavior, corporate social responsibility, and corruption – and evaluates the way in which multinational enterprises (MNEs) manage political and social forces in a foreign emerging market. Using the theory of structuration as the conceptual foundation, we propose that an MNE's propensity to cooperate with the host government is positively related to its philanthropic contribution and resource accommodation, whereas its propensity to be assertive with the host government is positively associated with its emphasis on ethics and organizational credibility. We argue that when perceived corruption in the business segment increases, an MNE's propensity to cooperate and be assertive with the government decreases, its focus on ethics heightens, and its philanthropic contribution diminishes. As to the three-way interactions, when perceived corruption in the business segment increases, MNEs that focus more on ethics have a greater propensity to use arm's length bargaining to deal with the government, whereas those focusing less on ethics have a greater propensity to use social connections to deal with the government. Our analysis of sample MNEs in China generally supports these propositions. Journal of International Business Studies (2006) 37, 747–766. doi:10.1057/palgrave.jibs.8400224

An evolutionary approach to understanding international business activity: The co-evolution of MNEs and the institutional environment

This paper examines the co-evolution of mne activities and institutions external and internal to the firm. We develop a theoretical framework for this analysis that draws on the more recent writings of douglass north on institutions as a response to complex forms of uncertainty associated with the rise in global economic interconnectedness, and of richard nelson on the co-evolution of technology and institutions. We link historical changes in the character of mne activities to changes in the institutional environment, and highlight the scope for firm-level creativity and institutional entrepreneurship that may lead to co-evolution with the environment. We argue that the main drivers for institutional entrepreneurship are now found in the increasing autonomy of mne subsidiaries. Thus mne agency derives from more decentralized forms of experimentation in international corporate networks, which competence-creating nodes of new initiatives can co-evolve with local institutions. Unlike most other streams of related literature, our approach connects patterns of institutional change in wider business systems with more micro processes of variety generation and experimentation within and across individual firms. This form of co-evolutionary analysis is increasingly important to understanding the interrelationships between mne activities and public policy