MNE Entrepreneurial Capabilities at Intermediate Levels: The Roles of External Embeddedness and Heterogeneous Environments

This study investigates the entrepreneurial capabilities of MNE units at intermediate geographical levels, between the local subsidiary level and global corporate headquarters. In our conceptual development, we build on the entrepreneurship and MNE embeddedness literature to explain how MNE units at intermediate geographical levels differ from local subsidiaries and global corporate headquarters, and why those differences are important. We illustrate our arguments using data on European regional headquarters (RHQs). We find that RHQs' entrepreneurial capabilities depend on their external embeddedness and on the heterogeneous information that is generated through dissimilar markets within the region. Our study opens up for an interesting discussion of the independence of these mechanisms. In sum, we contribute to the understanding of the entrepreneurial role of intermediate units in general and RHQs in particular. (authors' abstract

The MNC as an externally embedded organization: An investigation of embeddedness overlap in local subsidiary networks

MNCs have been conceptualized as differentiated networks that, in turn, are embedded in external networks. Previous research has predominantly focused on the embeddedness of established subsidiaries into their local environment, omitting to shed light on the phenomenon of headquarters linkages to the local context which creates embeddedness overlap. We develop a model of why MNCs develop overlapping linkages to local subsidiary networks even if the subsidiaries have grown out of the initial start-up phase. Using detailed information on 168 European subsidiaries, we find that MNCs build and maintain more overlapping network ties when subsidiaries are high performers, hold important resources, operate in turbulent environments, and are closely connected to multinational actors as opposed to purely domestic firms