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Backshoring in Light of the Concepts of Divestment and De-internationalization: Similarities and Differences

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  • Michał Młody

    (Poznan University of Economics and Business, Poland)

Abstract

Objective: The purpose of this article is to evaluate the adequacy of the present theoretical knowledge relating to divestments and de-internationalization in the context of explaining the backshoring phenomenon – a relatively new, but gaining in importance specific behaviour of companies in the process of internationalization. Research Design & Methods: The paper discusses various aspects of contemporary processes of internationalization. The employed research design is qualitative – the study has been based on conclusions drawn from critical literature studies. Findings: Although backshoring shares some common characteristics with the concepts of de-internationalization and international divestments, there are several noticeable differences: e.g. both de-internationalization and international divestments are rather related to wholly owned subsidiaries, while backshoring includes both activities outsourced to company’s foreign suppliers and to its subsidiaries. Implications & Recommendations: It is necessary to develop new concepts that in a holistic way will define the decision-making process of enterprises which use de-internationalization and backshoring of business processes as part of their longterm internationalization strategies. The article indicates some dependencies and issues that must be considered in formulating new theoretical proposals. Contribution & Value Added: The originality of this study lies in the in-depth analysis of the similarities and differences between the processes of deinternationalization/international divestments and backshoring.

Suggested Citation

  • Michał Młody, 2016. "Backshoring in Light of the Concepts of Divestment and De-internationalization: Similarities and Differences," Entrepreneurial Business and Economics Review, Centre for Strategic and International Entrepreneurship at the Cracow University of Economics., vol. 4(3), pages 167-180.
    • Handle: RePEc:krk:eberjl:v:4:y:2016:i:3:p:167-180
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    More about this item

    Keywords

    backshoring; reshoring; international divestment; internationalization process; de-internationalization;
    All these keywords.

    JEL classification:

    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • L21 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Business Objectives of the Firm
    • L23 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Organization of Production

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