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Foreign Subsidiary and Parents' Roles During Strategic Investment and Divestment Decisions

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  • Michel Ghertman

    (Centre HEC-ISA)

Abstract

Empirical research is scarce to answer the concerns of governments, unions and public opinion at large, concerning how multinationals make decisions to restructure their international strategic portfolio or close plants overseas to ensure long-run competitiveness. Based on three in-depth analyses of different types of restructing decisions, the author concludes that the foreign subsidiaries seem to carry most of the decisionmaking effort for their own plant closures, while for strategic portfolio readjustments during which they change owners, they are not consulted.© 1988 JIBS. Journal of International Business Studies (1988) 19, 47–67

Suggested Citation

  • Michel Ghertman, 1988. "Foreign Subsidiary and Parents' Roles During Strategic Investment and Divestment Decisions," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 19(1), pages 47-67, March.
    • Handle: RePEc:pal:jintbs:v:19:y:1988:i:1:p:47-67
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    Citations

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    Cited by:

    1. Colm Kearney & Frank Barry, 2005. "MNEs and Industrial Structure in Host Countries:A Mean Variance Analysis of Ireland’s Manufacturing Sector," The Institute for International Integration Studies Discussion Paper Series iiisdp023, IIIS.
    2. Milena Ratajczak-Mrozek, 2015. "Czas w badaniach nad internacjonalizacją przedsiębiorstw," Gospodarka Narodowa. The Polish Journal of Economics, Warsaw School of Economics, issue 4, pages 49-67.
    3. José Mata & Pedro Portugal, 2000. "Closure and divestiture by foreign entrants: the impact of entry and post‐entry strategies," Strategic Management Journal, Wiley Blackwell, vol. 21(5), pages 549-562, May.
    4. Clegg, Jeremy & Lin, Hsin Mei & Voss, Hinrich & Yen, I-Fan & Shih, Yi Tien, 2016. "The OFDI patterns and firm performance of Chinese firms: The moderating effects of multinationality strategy and external factors," International Business Review, Elsevier, vol. 25(4), pages 971-985.
    5. Brown, T. & Panibratov, A., 2016. "Foreign divestment decisions: A theoretical framework," Working Papers 6450, Graduate School of Management, St. Petersburg State University.
    6. Trąpczyński Piotr, 2018. "Opening the “Black Box” of Firm De-internationalisation Processes: What Should We Still Know?," Journal of Intercultural Management, Sciendo, vol. 10(1), pages 143-171, March.
    7. Ryan W. Tang & Ying Zhu & Hongbo Cai & Jinrong Han, 2021. "De-internationalization: A Thematic Review and the Directions Forward," Management International Review, Springer, vol. 61(3), pages 267-312, June.
    8. Kent Ngan-Cheung Hui & Yuanyuan Gong & Qi Cui & Naipeng Jiang, 2022. "Foreign investment or divestment as a near-term solution to performance shortfalls? The moderating role of vicarious learning," Asia Pacific Journal of Management, Springer, vol. 39(4), pages 1481-1509, December.
    9. Alex Mohr & Georgios Batsakis & Zita Stone, 2018. "Explaining the effect of rapid internationalization on horizontal foreign divestment in the retail sector: An extended Penrosean perspective," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 49(7), pages 779-808, September.
    10. Pauwels, P.F.J. & Matthyssens, P., 2002. "The dynamics of international market withdrawal," Research Memorandum 038, Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR).
    11. Procher, Vivien D. & Engel, Dirk, 2018. "The investment-divestment relationship: Resource shifts and intersubsidiary competition within MNEs," International Business Review, Elsevier, vol. 27(3), pages 528-542.
    12. Zhang, Tingting (Grace) & You, Yu, 2021. "Scale or efficiency? Performance shortfall and engagement in production activities of foreign subsidiaries in China," Journal of International Management, Elsevier, vol. 27(1).
    13. Pedersen, Torben & Petersen, Bent, 1998. "Explaining gradually increasing resource commitment to a foreign market," International Business Review, Elsevier, vol. 7(5), pages 483-501, October.

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