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Host-country headquarters and an MNE's subsequent within-country diversifications

Author

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  • Xufei Ma

    (Department of Management, The Chinese University of Hong Kong, New territories, Hong Kong)

  • Andrew Delios

    (Department of Business Policy, NUS Business School, National University of Singapore, Singapore)

Abstract

We propose that the establishment of a host-country headquarters (HCHQ) in a large emerging market can be viewed as part of a multinational enterprise's (MNE) political strategy to facilitate its within-country diversifications by reducing institutional intervention of the host government. Using a sample of MNEs in China in the period 1979–2005, we find that MNEs with an HCHQ had a greater number of subsequent diversifications in China, as compared with those MNEs without an HCHQ. This effect was more prominent when the diversifications were in domains with a higher level of institutional intervention.

Suggested Citation

  • Xufei Ma & Andrew Delios, 2010. "Host-country headquarters and an MNE's subsequent within-country diversifications," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 41(3), pages 517-525, April.
    • Handle: RePEc:pal:jintbs:v:41:y:2010:i:3:p:517-525
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    Citations

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    Cited by:

    1. Jun Xia & Xufei Ma & Jane W. Lu & Daphne W. Yiu, 2014. "Outward foreign direct investment by emerging market firms: A resource dependence logic," Strategic Management Journal, Wiley Blackwell, vol. 35(9), pages 1343-1363, September.
    2. Pan, Yigang & Teng, Lefa & Yu, Mingyang & Lu, Xiongwen & Huang, Dan, 2014. "Host-country Headquarters of U.S. Firms in China: An Empirical Study," Journal of International Management, Elsevier, vol. 20(4), pages 379-389.
    3. Osabutey, Ellis L.C. & Jackson, Terence, 2019. "The impact on development of technology and knowledge transfer in Chinese MNEs in sub-Saharan Africa: The Ghanaian case," Technological Forecasting and Social Change, Elsevier, vol. 148(C).
    4. McDonald, Conor & Buckley, Peter J. & Voss, Hinrich & Cross, Adam R. & Chen, Liang, 2018. "Place, space, and foreign direct investment into peripheral cities," International Business Review, Elsevier, vol. 27(4), pages 803-813.
    5. Sewak, Mayank & Sharma, Anurag, 2020. "Performance implications of MNE subsidiary federation: Evidence from India," Journal of International Management, Elsevier, vol. 26(1).
    6. Tianjiao Xia & Xiaohui Liu, 2017. "Foreign competition, domestic competition and innovation in Chinese private high-tech new ventures," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 48(6), pages 716-739, August.
    7. 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.
    8. Danchi Tan & Weichieh Su & Joseph T. Mahoney & Yasemin Kor, 2020. "A review of research on the growth of multinational enterprises: A Penrosean lens," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 51(4), pages 498-537, June.
    9. Kirca, Ahmet H. & Fernandez, Whitney Douglas & Kundu, Sumit K., 2016. "An empirical analysis and extension of internalization theory in emerging markets: The role of firm-specific assets and asset dispersion in the multinationality-performance relationship," Journal of World Business, Elsevier, vol. 51(4), pages 628-640.

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