Using a 'Systems' Perspective to Explain the Limits of 'New' Multinational Enterprises: the role of 'members-only' location advantages

Narula, Rajneesh (2013). Using a 'Systems' Perspective to Explain the Limits of 'New' Multinational Enterprises: the role of 'members-only' location advantages. UNU-MERIT.

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  • Author Narula, Rajneesh
    Title Using a 'Systems' Perspective to Explain the Limits of 'New' Multinational Enterprises: the role of 'members-only' location advantages
    Publication Date 2013
    Publisher UNU-MERIT
    Abstract I take as a starting point that the location-specific assets of the home country determine to a significant degree firm-specific assets of its firms and MNEs. This strong bond persists because of the interdependence between actors within a system, which has a growing cross-border aspect due to globalization. I highlight the importance of institutions, not as a black box of rules, but as an invisible mesh that envelope, shape and constrain the actions of actors in a given system, and these actors are themselves - collectively and occasionally individually - responsible for the nature of institutions. I highlight that location advantages are not always freely available to all actors in a given location. There are important location advantages that are 'members-only' for which access is restricted to incumbents, and do not have a public good nature implied in the IB literature. This lies at the heart of the inertia of firms, and the difficulties of successfully leveraging location-bound assets in other countries, as well as the challenges of 'leaving home', since they may forfeit domestic 'membership' to do so. Home country L assets play a large part in defining EMNE FSAs, and where governments are unable to upgrade these (due to government failure or regulatory capture) it weakens the building block upon which sustainable outward FDI is possible.
    Keyword Collocation
    Innovation systems
    Emerging countries
    MNEs
    Institutions
    Globalization
    Location advantages
    JEL F23
    F68
    O32
    Copyright Holder UNU-MERIT
    Copyright Year 2013
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    Created: Wed, 11 Dec 2013, 17:15:15 JST