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Knowledge creation capability in MNC subsidiaries: Examining the roles of global and local knowledge inflows and subsidiary knowledge stocks

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  • Colakoglu, Saba
  • Yamao, Sachiko
  • Lepak, David P.

Abstract

Grounded in knowledge-based theories of the multinational corporation (MNC) and building on organizational learning literature, this paper develops and tests a model of MNC subsidiaries’ knowledge creation capability as a joint function of knowledge inflows to subsidiaries and their knowledge stocks (i.e., subsidiaries’ internal human, social, and organizational capital). Survey-based data from 106 subsidiaries located in the U.S. suggests that local (i.e., host country) knowledge inflows to a subsidiary are more effective in enhancing a subsidiary's knowledge creation capability compared to global knowledge inflows from other units of the same MNC. Furthermore, results point to a not-invented-here syndrome in the exploitation of knowledge sourced from the parent company; such that when a subsidiary's internal social capital is high, the relationship between global knowledge inflows and knowledge creation capability is negative and when it is low, the relationship becomes positive.

Suggested Citation

  • Colakoglu, Saba & Yamao, Sachiko & Lepak, David P., 2014. "Knowledge creation capability in MNC subsidiaries: Examining the roles of global and local knowledge inflows and subsidiary knowledge stocks," International Business Review, Elsevier, vol. 23(1), pages 91-101.
    • Handle: RePEc:eee:iburev:v:23:y:2014:i:1:p:91-101
    DOI: 10.1016/j.ibusrev.2013.08.009
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