IDEAS home Printed from https://ideas.repec.org/a/eee/worbus/v44y2009i2p108-120.html
   My bibliography  Save this article

MNEs and development: a review and reconceptualization

Author

Listed:
  • Oetzel, Jennifer
  • Doh, Jonathan P.

Abstract

In this paper, we review and critique two prominent theories in the international business and international economics literatures regarding the role of multinational enterprises (MNEs) in host country development: the "spillovers" perspective on the impact of MNE investment in host countries and the liabilities of foreignness (LOF) view that specifies the constraints MNEs must overcome to succeed in local, developing country markets. We then propose an alternative conceptualization of MNE-host country relations in which MNEs and local nongovernmental organizations (NGOs) pursue collaborative relationships that make a positive, collective contribution to host country development and to MNE and NGO strategic goals in ways that neither sector is positioned to do alone.

Suggested Citation

  • Oetzel, Jennifer & Doh, Jonathan P., 2009. "MNEs and development: a review and reconceptualization," Journal of World Business, Elsevier, vol. 44(2), pages 108-120, April.
    • Handle: RePEc:eee:worbus:v:44:y:2009:i:2:p:108-120
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1090951608000400
    Download Restriction: Full text for ScienceDirect subscribers only
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Ravi Ramamurti, 2004. "Developing countries and MNEs: extending and enriching the research agenda," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 35(4), pages 277-283, July.
    2. Jonathan E. Haskel & Sonia C. Pereira & Matthew J. Slaughter, 2007. "Does Inward Foreign Direct Investment Boost the Productivity of Domestic Firms?," The Review of Economics and Statistics, MIT Press, vol. 89(3), pages 482-496, August.
    3. Alan M. Rugman, 1993. "Drawing the Border for a Multinational Enterprise and a Nation-State," Palgrave Macmillan Books, in: Lorraine Eden & Evan H. Potter (ed.), Multinationals in the Global Political Economy, chapter 5, pages 84-100, Palgrave Macmillan.
    4. Bruce Kogut & Udo Zander, 1992. "Knowledge of the Firm, Combinative Capabilities, and the Replication of Technology," Organization Science, INFORMS, vol. 3(3), pages 383-397, August.
    5. Koen De Backer & Leo Sleuwaegen, 2003. "Does Foreign Direct Investment Crowd Out Domestic Entrepreneurship?," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 22(1), pages 67-84, February.
    6. Michael Hitt & M. Tina Dacin & Edward Levitas & Jean-Luc Arregle & Anca Borza, 2000. "Partner Selection in Emerging and Developed Market Contexts : Resource-Based and Organizational Learning Perspectives," Post-Print hal-02276706, HAL.
    7. Jonathan P Doh, 2005. "Making Globalization Good: The Moral Challenges of Global Capitalism," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 36(1), pages 119-121, January.
    8. Palma, Gabriel, 1978. "Dependency: A formal theory of underdevelopment or a methodology for the analysis of concrete situations of underdevelopment?," World Development, Elsevier, vol. 6(7-8), pages 881-924.
    9. Jutta Günther, 2002. "FDI as a multiplier of modern technology in Hungarian industry," Intereconomics: Review of European Economic Policy, Springer;ZBW - Leibniz Information Centre for Economics;Centre for European Policy Studies (CEPS), vol. 37(5), pages 263-269, September.
    10. Brian J. Aitken & Ann E. Harrison, 2022. "Do Domestic Firms Benefit from Direct Foreign Investment? Evidence from Venezuela," World Scientific Book Chapters, in: Globalization, Firms, and Workers, chapter 6, pages 139-152, World Scientific Publishing Co. Pte. Ltd..
    11. Wheeler, David, 2001. "Racing to the bottom : foreign investment and air pollution in developing countries," Policy Research Working Paper Series 2524, The World Bank.
    12. Magnus Blomström & Ari Kokko & Mario Zejan, 2000. "Technology, Market Characteristics and Spillovers," Palgrave Macmillan Books, in: Foreign Direct Investment, chapter 10, pages 160-176, Palgrave Macmillan.
    13. Peter J Buckley & Pervez N Ghauri, 2004. "Globalisation, economic geography and the strategy of multinational enterprises," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 35(3), pages 255-255, May.
    14. repec:bla:econom:v:41:y:1974:i:162:p:176-93 is not listed on IDEAS
    15. Greenaway, David & Görg, Holger, 2002. "Much Ado About Nothing? Do Domestic Firms Really Benefit from Foreign Investment?," CEPR Discussion Papers 3485, C.E.P.R. Discussion Papers.
    16. Mike W Peng, 2004. "Identifying the big question in international business research," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 35(2), pages 99-108, March.
    17. Rajneesh Narula & John Dunning, 2000. "Industrial Development, Globalization and Multinational Enterprises: New Realities for Developing Countries," Oxford Development Studies, Taylor & Francis Journals, vol. 28(2), pages 141-167.
    18. Zaheer, Srilata, 2002. "The liability of foreignness, redux: a commentary," Journal of International Management, Elsevier, vol. 8(3), pages 351-358.
    19. Lorraine Eden & Stefanie Lenway, 2001. "Introduction to the Symposium Multinationals: The Janus Face of Globalization*," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 32(3), pages 383-400, September.
    20. Michael Hitt & M. Tina Dacin & Edward Levitas & Jean-Luc Arregle & Anca Borza, 2000. "Partner Selection in Emerging and Developed Market Contexts : Resource-Based and Organizational Learning Perspectives," Post-Print hal-02312691, HAL.
    21. Luo, Yadong & Shenkar, Oded & Nyaw, Mee-Kau, 2002. "Mitigating liabilities of foreignness: Defensive versus offensive approaches," Journal of International Management, Elsevier, vol. 8(3), pages 283-300.
    22. Wang, Jian-Ye & Blomstrom, Magnus, 1992. "Foreign investment and technology transfer : A simple model," European Economic Review, Elsevier, vol. 36(1), pages 137-155, January.
    23. Woolcock, Michael & Narayan, Deepa, 2000. "Social Capital: Implications for Development Theory, Research, and Policy," The World Bank Research Observer, World Bank, vol. 15(2), pages 225-249, August.
    24. Blomstrom, Magnus & Persson, Hakan, 1983. "Foreign investment and spillover efficiency in an underdeveloped economy: Evidence from the Mexican manufacturing industry," World Development, Elsevier, vol. 11(6), pages 493-501, June.
    25. Lowe, Nichola & Kenney, Martin, 1999. "Foreign Investment and the Global Geography of Production: Why the Mexican Consumer Electronics Industry Failed," World Development, Elsevier, vol. 27(8), pages 1427-1443, August.
    26. Kam C. Chan, 2006. "Guest Editor's Introduction," Chinese Economy, Taylor & Francis Journals, vol. 39(5), pages 3-4, October.
    27. Vakil, Anna C., 1997. "Confronting the classification problem: Toward a taxonomy of NGOs," World Development, Elsevier, vol. 25(12), pages 2057-2070, December.
    28. David J. Teece, 2008. "Technology Transfer By Multinational Firms: The Resource Cost Of Transferring Technological Know-How," World Scientific Book Chapters, in: The Transfer And Licensing Of Know-How And Intellectual Property Understanding the Multinational Enterprise in the Modern World, chapter 1, pages 1-22, World Scientific Publishing Co. Pte. Ltd..
    29. Louis T Wells, 1998. "Multinationals and the Developing Countries," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 29(1), pages 101-114, March.
    30. Nathan Fagre & Louis T Wells, 1982. "Bargaining Power of Multinationals and Host Governments," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 13(2), pages 9-24, June.
    31. Sethi, Deepak & Guisinger, Stephen, 2002. "Liability of foreignness to competitive advantage: How multinational enterprises cope with the international business environment," Journal of International Management, Elsevier, vol. 8(3), pages 223-240.
    32. Aneel Karnani, 2006. "Mirage at the Bottom of the Pyramid," William Davidson Institute Working Papers Series wp835, William Davidson Institute at the University of Michigan.
    33. Edwin Mansfield & Anthony Romeo, 1980. "Technology Transfer to Overseas Subsidiaries by U. S.-Based Firms," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 95(4), pages 737-750.
    34. Peter J Buckley, 2002. "Is the International Business Research Agenda Running Out of Steam?," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 33(2), pages 365-373, June.
    35. Srilata Zaheer & Elaine Mosakowski, 1997. "The Dynamics Of The Liability Of Foreignness: A Global Study Of Survival In Financial Services," Strategic Management Journal, Wiley Blackwell, vol. 18(6), pages 439-463, June.
    36. Steven Globerman, 1979. "Foreign Direct Investment and `Spillover' Efficiency Benefits in Canadian Manufacturing Industries," Canadian Journal of Economics, Canadian Economics Association, vol. 12(1), pages 42-56, February.
    37. Oded Shenkar, 2004. "One more time: international business in a global economy," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 35(2), pages 161-171, March.
    38. Wilfred Dolfsma & Charlie Dannreuther, 2003. "Subjects and Boundaries: Contesting Social Capital-Based Policies," Journal of Economic Issues, Taylor & Francis Journals, vol. 37(2), pages 405-413, June.
    39. Mark Casson & Nigel Wadeson, 1998. "Communication Costs and the Boundaries of the Firm," International Journal of the Economics of Business, Taylor & Francis Journals, vol. 5(1), pages 5-27.
    40. Hildy Teegen & Jonathan P Doh & Sushil Vachani, 2004. "The importance of nongovernmental organizations (NGOs) in global governance and value creation: an international business research agenda," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 35(6), pages 463-483, November.
    41. Peter J Buckley & Pervez N Ghauri, 2004. "Globalisation, economic geography and the strategy of multinational enterprises," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 35(2), pages 81-98, March.
    42. D. Eleanor Westney, 1993. "Institutionalization Theory and the Multinational Corporation," Palgrave Macmillan Books, in: Sumantra Ghoshal & D. Eleanor Westney (ed.), Organization Theory and the Multinational Corporation, chapter 3, pages 53-76, Palgrave Macmillan.
    43. Haddad, Mona & Harrison, Ann, 1993. "Are there positive spillovers from direct foreign investment? : Evidence from panel data for Morocco," Journal of Development Economics, Elsevier, vol. 42(1), pages 51-74, October.
    44. Klaus E Meyer, 2004. "Perspectives on multinational enterprises in emerging economies," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 35(4), pages 259-276, July.
    45. Rodriguez-Clare, Andres, 1996. "Multinationals, Linkages, and Economic Development," American Economic Review, American Economic Association, vol. 86(4), pages 852-873, September.
    46. Petra Christmann & Glen Taylor, 2001. "Globalization and the Environment: Determinants of Firm Self-Regulation in China," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 32(3), pages 439-458, September.
    47. Williamson, Oliver E, 1983. "Credible Commitments: Using Hostages to Support Exchange," American Economic Review, American Economic Association, vol. 73(4), pages 519-540, September.
    48. Glen Dowell & Stuart Hart & Bernard Yeung, 2000. "Do Corporate Global Environmental Standards Create or Destroy Market Value?," Management Science, INFORMS, vol. 46(8), pages 1059-1074, August.
    49. Peter J Buckley & Jeremy Clegg & Chengqi Wang, 2002. "The Impact of Inward FDI on the Performance of Chinese Manufacturing Firms," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 33(4), pages 637-655, December.
    50. Jennifer Clapp & Peter Dauvergne, 2005. "Paths to a Green World: The Political Economy of the Global Environment," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262532719, April.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Argentino Pessoa, 2008. "Multinational Corporations, Foreign Investment, and Royalties and License Fees: Effects on Host-Country Total Factor Productivity," Notas Económicas, Faculty of Economics, University of Coimbra, issue 28, pages 6-31, December.
    2. Klaus E Meyer & Evis Sinani, 2009. "When and where does foreign direct investment generate positive spillovers? A meta-analysis," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 40(7), pages 1075-1094, September.
    3. Gordon H. HANSON, 2001. "Should Countries Promote Foreign Direct Investment?," G-24 Discussion Papers 9, United Nations Conference on Trade and Development.
    4. Yadong Luo & Huan Zhang & Juan Bu, 2019. "Developed country MNEs investing in developing economies: Progress and prospect," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 50(4), pages 633-667, June.
    5. Jin, Shaosheng & Guo, Haiyue & Delgado, Michael S. & Wang, H. Holly, 2017. "Benefit or damage? The productivity effects of FDI in the Chinese food industry," Food Policy, Elsevier, vol. 68(C), pages 1-9.
    6. Kugler, Maurice, 2006. "Spillovers from foreign direct investment: Within or between industries?," Journal of Development Economics, Elsevier, vol. 80(2), pages 444-477, August.
    7. Neil Foster-McGregor, 2012. "Innovation and Technology Transfer across Countries," wiiw Research Reports 380, The Vienna Institute for International Economic Studies, wiiw.
    8. Le Thanh THUY, 2007. "Does Foreign Direct Investment Have an Impact on the Growth in Labor Productivity of Vietnamese Domestic Firms?," Discussion papers 07021, Research Institute of Economy, Trade and Industry (RIETI).
    9. Marin, Anabel & Sasidharan, Subash, 2010. "Heterogeneous MNC subsidiaries and technological spillovers: Explaining positive and negative effects in India," Research Policy, Elsevier, vol. 39(9), pages 1227-1241, November.
    10. Ben Hamida, Lamia & Gugler, Philippe, 2009. "Are there demonstration-related spillovers from FDI?: Evidence from Switzerland," International Business Review, Elsevier, vol. 18(5), pages 494-508, October.
    11. Hallin, Christina & Holmström Lind, Christine, 2012. "Revisiting the external impact of MNCs: An empirical study of the mechanisms behind knowledge spillovers from MNC subsidiaries," International Business Review, Elsevier, vol. 21(2), pages 167-179.
    12. J. Rosell-Martinez & P. Sanchez-Sellero, 2011. "Foreign direct investment and technical progress in Spanish manufacturing," Post-Print hal-00693830, HAL.
    13. Elisa Giuliani & Chiara Macchi, 2014. "Multinational corporations’ economic and human rights impacts on developing countries: a review and research agenda," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 38(2), pages 479-517.
    14. Wang, Danny T. & Gu, Flora F. & Tse, David K. & Yim, Chi Kin (Bennett), 2013. "When does FDI matter? The roles of local institutions and ethnic origins of FDI," International Business Review, Elsevier, vol. 22(2), pages 450-465.
    15. Sinani, Evis & Meyer, Klaus E., 2004. "Spillovers of technology transfer from FDI: the case of Estonia," Journal of Comparative Economics, Elsevier, vol. 32(3), pages 445-466, September.
    16. Holger Görg & David Greenaway, 2016. "Much Ado about Nothing? Do Domestic Firms Really Benefit from Foreign Direct Investment?," World Scientific Book Chapters, in: MULTINATIONAL ENTERPRISES AND HOST COUNTRY DEVELOPMENT Volume 53: World Scientific Studies in International Economics, chapter 9, pages 163-189, World Scientific Publishing Co. Pte. Ltd..
    17. Noor Aini Khalifah & Radziah Adam, 2009. "Productivity Spillovers from FDI in Malaysian Manufacturing: Evidence from Micro‐panel Data," Asian Economic Journal, East Asian Economic Association, vol. 23(2), pages 143-167, June.
    18. Della Temenggung, 2007. "Productivity Spillovers from Foreign Direct Investment: Indonesian Manufacturing Industry’s Experience 1975-2000," DEGIT Conference Papers c012_048, DEGIT, Dynamics, Economic Growth, and International Trade.
    19. Ivan Montiel & Alvaro Cuervo-Cazurra & Junghoon Park & Raquel Antolín-López & Bryan W. Husted, 2021. "Implementing the United Nations’ Sustainable Development Goals in international business," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 52(5), pages 999-1030, July.
    20. Fernando Ubeda & Francisco Pérez-Hernández, 2017. "Absorptive Capacity and Geographical Distance Two Mediating Factors of FDI Spillovers: a Threshold Regression Analysis for Spanish Firms," Journal of Industry, Competition and Trade, Springer, vol. 17(1), pages 1-28, March.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:worbus:v:44:y:2009:i:2:p:108-120. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/wps/find/journaldescription.cws_home/620401/description#description .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.