scholarly journals Location choice of multinational enterprises in China: Comparison between Japan and Taiwan

2013 ◽  
Vol 93 (3) ◽  
pp. 521-537 ◽  
Author(s):  
Kuo-I Chang ◽  
Kazunobu Hayakawa ◽  
Toshiyuki Matsuura
Keyword(s):  
Multinational Enterprises ◽  
Location Choice

The influence of motivations on international location choice in least developed, emerging and developed countries: evidence from Chinese MNEs

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Fernando Angulo-Ruiz ◽  
Albena Pergelova ◽  
William X. Wei
Keyword(s):  
Emerging Markets ◽  
Multinational Enterprises ◽  
Location Choice ◽  
Emerging Market ◽  
Developed Countries ◽  
Asia Pacific ◽  
Institutional Constraints ◽  
Least Developed Countries ◽  
Content Type ◽  
Developed Economies

Purpose This research aims to assess variations of motivations when studying international location decisions. In particular, this study aims to assess the influence of diverse motivations – seeking technology, seeking brand assets, seeking markets, seeking resources and escaping institutional constraints – as determinants of the international location choice of emerging market multinational enterprises (EM MNEs) entering least developed, emerging, and developed countries. Design/methodology/approach The authors develop a set of hypotheses based on the ownership–location–internalization framework and complement it with an institutional perspective. The conceptual model posits that the different internationalization motivations (seeking technology, seeking brand assets, seeking markets, seeking resources and escaping institutional constraints) will impact the location choice of EM MNEs in developed economies, emerging markets or least developed countries. This study uses the 2013 survey data collected by the China Council for the Promotion of International Trade and the Asia Pacific Foundation of Canada. The final sample of analysis of this research includes 693 observations. Findings After controlling for several variables, two-stage Heckman regressions show there is a variation of motivations when EM MNEs enter least developed countries, emerging markets and developed economies. EM MNEs are motivated to enter least developed countries to seek markets and resources. Conversely, those firms enter developed countries in their search for technological assets and to escape institutional constraints at home. While the present study findings show a clear difference in the motivations that lead to location choice in least developed vs developed countries, the results are not as clear for location in other emerging countries. Research limitations/implications The paper offers empirical support for the importance of motivations as crucial determinants of location choice. Originality/value This paper provides a detailed quantitative study on the internationalization location choice of EM MNEs based on their motivations. Though theoretical models underscore the importance of motivations, we know very little about how, in practice, motivations drive location choice. This study contributes to the international location choice literature a deeper understanding of how diverse motivations drive choices of expansion into developed economies, emerging markets or least developed countries.

scholarly journals The Location Choice of Foreign Direct Investment and Economic Development in Africa

2021 ◽  
Vol 13 (10) ◽  
pp. 69
Author(s):  
Abdisalan Salad Warsame
Keyword(s):  
Economic Development ◽  
Foreign Direct Investment ◽  
Natural Resource ◽  
Direct Investment ◽  
Multinational Enterprises ◽  
Developing Economies ◽  
Location Choice ◽  
Market Size ◽  
Location Choices ◽  
Large Market

Foreign Direct Investment (FDI) inflow to Africa has unevenly distributed investment location choices of multinational enterprises because of some exogenous economic factors associated with the locations, which vary across countries in Africa. The data used in the paper comes from Financial Times, World Bank, African Development Bank. This paper investigated what determines the location choice of FDI inflow to Africa using data on 3,768 firms from 88 countries making location choices in 54 African countries using a multicategory logistic regression. The findings show that: (1) the natural resource seeking enterprises invest more in landlocked countries relative to manufacturing and tertiary sector; (2) the natural resource seeking firms are less concerned about local market size and location’s economic condition comparing to manufacturing and service industries; (3) despite the accusation against the multinational enterprises (MNEs) for exploiting Africa’s natural resources, most of the MNEs choose locations with a large market size and better economic development; (4) the MNEs from developed economies prefer the location with a large market size and a better-developed economy comparing to those from the developing economies.

scholarly journals Location choice, ownership structure and multinational performance

2018 ◽  
Vol 26 (3) ◽  
pp. 250-276 ◽  
Author(s):  
Jinlong Gu ◽  
Yong Yang ◽  
Roger Strange
Keyword(s):  
Ownership Structure ◽  
Multinational Enterprises ◽  
Location Choice ◽  
Developed Countries ◽  
Institutional Perspective ◽  
Data Set ◽  
Content Type ◽  
Foreign Operation ◽  
Investment Location ◽  
Positive Effect

Purpose This paper aims to link location choice and ownership structure to the debate on the multinationality–performance relationship. Design/methodology/approach This paper draws on a panel data set that covers 1,321 emerging economy multinational enterprises (EMNEs) and includes 4,227 observations from 44 emerging economies between 2004 and, 2013. Findings The empirical results find that multinationality has a positive effect on EMNEs’ performance, and that this positive effect is larger for their investments in developed countries than in developing countries. The study also finds that this positive effect of foreign operation in developed countries switch to negative at higher levels of multinationality for privately owned EMNEs than for state-owned EMNEs. Originality/value This paper provides new empirical evidence to support an institutional perspective of the internationalisation of EMNEs that are investing in developed countries, contributing to the multinationality-performance literature, highlighting the importance of foreign direct investment location decision and ownership structure.

scholarly journals The influence of political risk, inertia and imitative behavior on the location choice of Chinese multinational enterprises

2018 ◽  
Vol 13 (3) ◽  
pp. 518-535 ◽  
Author(s):  
Diego Quer ◽  
Enrique Claver ◽  
Laura Rienda
Keyword(s):  
Host Country ◽  
Multinational Enterprises ◽  
Location Choice ◽  
Political Risk ◽  
State Ownership ◽  
Government Support ◽  
Chinese Firms ◽  
Content Type ◽  
Mimetic Behavior ◽  
Chinese Multinational Enterprises

Purpose Drawing on the institutional perspective, the purpose of this paper is to investigate how state ownership moderates the relationships between political risk, inertia and mimetic behavior, and the location choice of Chinese multinational enterprises (MNEs). Design/methodology/approach The authors argue that state ownership leads Chinese firms to behave toward political risk in an unconventional way, and that government support makes them less dependent on their own and other Chinese firms’ prior host country experience. The authors tested the hypotheses using data on outward foreign direct investment (OFDI) decisions made by 186 Chinese firms in 93 countries. Findings The authors found that Chinese state-owned enterprises (SOEs), compared to non-SOEs, are more likely to move into countries with high political risk, and that they are less likely to be inertial and mimetic. Originality/value Building on the distinction between macro- and micro-political risk, The authors contribute to the political risk literature by developing several arguments that explains why political risk varies across investing firms in a given host country. Moreover, this is one of the first studies of its kind to investigate the moderating effect of state ownership on the relationship between inertial and mimetic behavior, and the location choice of Chinese MNEs.

Can’t take the heat? Climate and foreign subsidiary locations

2019 ◽  
Vol 15 (1) ◽  
pp. 42-67
Author(s):  
Amanda Budde-Sung ◽  
Tanya A. Peacock
Keyword(s):  
Economic Theory ◽  
Multinational Enterprises ◽  
Multinational Firms ◽  
Global Financial Crisis ◽  
Location Choice ◽  
Economic Effects ◽  
Foreign Subsidiary ◽  
Global Business ◽  
Data Set ◽  
Content Type

Purpose This paper aims to build upon climato-economic theory to investigate the issue of climate’s effect on foreign expansion and location choice. Design/methodology/approach This empirical paper looks at foreign subsidiary location through the lens of the climato-economic theory. To do this, the study uses a balanced data set, looking at foreign expansion before, during and after the global financial crisis of US multinational firms. A multilevel step-wise regression is used to look at climate, culture and economic effects on foreign location choice. Findings The findings suggest that US multinational enterprises tend to have fewer foreign subsidiaries in countries with extreme climates, and they prefer locations with warmer climates, avoiding locations with colder climates, although they gravitate toward locations with less sunshine. Climate emerges as an important factor in location choice, with greater weighting than other factors, including economic and cultural factors in times of economic calm, but the weightings of the factors change during times of economic crisis. Originality/value This paper contributes to the global business literature by extending the climate-economic theory to macro levels affecting the firm. The paper is the first to look specifically at how climate affects foreign subsidiary location.

How EMNEs choose location for strategic asset seeking in internationalization?

2019 ◽  
Vol 13 (3) ◽  
pp. 687-705 ◽  
Author(s):  
Qiuling Gao ◽  
Zijie Li ◽  
Xinli Huang
Keyword(s):  
Multinational Enterprises ◽  
Manufacturing Industry ◽  
Location Choice ◽  
Three Dimensions ◽  
Strategic Decision ◽  
Multiple Sources ◽  
Content Type ◽  
Complementary Resources ◽  
Institutional Dimension ◽  
New Research

Purpose Based on the strategy tripod perspective, this study aims to address how emerging economy multinational enterprises (EMNEs) make a strategic decision of choosing a foreign location for their strategic asset seeking and under what mechanism EMNEs make foreign direct investment (FDI) location choice. Design/methodology/approach This paper first reviews the literature on strategy tripod and strategic asset seeking strategy of EMNEs. Then, six cases of Chinese multinational enterprises operating in manufacturing industry have been introduced, emphasizing on interactions within three dimensions of strategy tripod framework, namely, resource-based dimension, industry-based dimension and institution-based dimension. By triangulating with multiple sources of archival and interview data, this paper identified a conceptual model presenting location choice mechanisms. Findings Based on a comparative multi-case study, four mechanisms of EMNEs’ location choice when seek strategic asset by FDI within a strategy tripod framework have been revealed. Specifically, EMNEs make their strategic decision of choosing a foreign location for their strategic asset seeking under mechanisms of seeking complementary resources based on industry characteristics; echoing with institutional dimension of home country when exploitation of resource; matching institutional dimension of host country when consider industry fitness; and institutional leveraging combined with understanding of resource and industry dimensions inside strategy tripod. Originality/value The findings shed novel insights into the mechanisms under which EMNEs choose their location for strategic asset-seeking FDI. It also broadens the strategy tripod framework by looking deeper into the characteristics of each dimension within a new research context of EMNEs’ FDI location choice.

Centralization and Effectiveness of Reward Management in Multinational Enterprises

2018 ◽  
Vol 17 (2) ◽  
pp. 55-65 ◽  
Author(s):  
Michael Tekieli ◽  
Marion Festing ◽  
Xavier Baeten
Keyword(s):  
Decision Making ◽  
Social Identity Theory ◽  
Multinational Enterprises ◽  
Role Identity ◽  
Management Decision ◽  
Role Identities ◽  
Management Decision Making ◽  
New Perspective ◽  
Subsidiary Managers ◽  
The Relationship

Abstract. Based on responses from 158 reward managers located at the headquarters or subsidiaries of multinational enterprises, the present study examines the relationship between the centralization of reward management decision making and its perceived effectiveness in multinational enterprises. Our results show that headquarters managers perceive a centralized approach as being more effective, while for subsidiary managers this relationship is moderated by the manager’s role identity. Referring to social identity theory, the present study enriches the standardization versus localization debate through a new perspective focusing on psychological processes, thereby indicating the importance of in-group favoritism in headquarters and the influence of subsidiary managers’ role identities on reward management decision making.

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