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States and Firms on the Periphery: The Challenges of a Globalizing World

In: Multinationals on the Periphery

Author

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  • Gabriel R. G. Benito
  • Rajneesh Narula

Abstract

One of the primary features of globalization has been the growth and spread of multinational enterprises (MNEs), and their increasing significance in the economies of almost all countries, whether large or small, developing or industrialized. MNEs have sought to spatially distribute their value-adding activities globally to not only take advantage of market opportunities but also to exploit different specialized resources and capabilities that are unique to particular locations. In other words, in response to increasing cross-border competition and rivalry, firms have increasingly sought to organize their activities internationally to achieve greater efficiency in their value-adding activities, and thereby optimizing their market share and rent generation.

Suggested Citation

  • Gabriel R. G. Benito & Rajneesh Narula, 2007. "States and Firms on the Periphery: The Challenges of a Globalizing World," Palgrave Macmillan Books, in: Gabriel R. G. Benito & Rajneesh Narula (ed.), Multinationals on the Periphery, chapter 1, pages 1-24, Palgrave Macmillan.
    • Handle: RePEc:pal:palchp:978-0-230-59304-6_1
    DOI: 10.1057/9780230593046_1
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    References listed on IDEAS

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    1. Paul Krugman & Anthony J. Venables, 1995. "Globalization and the Inequality of Nations," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 110(4), pages 857-880.
    2. Narula, Rajneesh & Marin, Anabel, 2005. "Exploring the relationship between direct and indirect spillovers from FDI in Argentina," Research Memorandum 024, Maastricht University, Maastricht Economic Research Institute on Innovation and Technology (MERIT).
    3. 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.
    4. G R G Benito & B Grøgaard & R Narula, 2003. "Environmental influences on MNE subsidiary roles: economic integration and the Nordic countries," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 34(5), pages 443-456, September.
    5. Raymond Vernon, 1966. "International Investment and International Trade in the Product Cycle," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 80(2), pages 190-207.
    6. Fosfuri, Andrea & Motta, Massimo & Ronde, Thomas, 2001. "Foreign direct investment and spillovers through workers' mobility," Journal of International Economics, Elsevier, vol. 53(1), pages 205-222, February.
    7. Gabriel Robertstad G. Benito & Jorma Larimo & Rajneesh Narula & Torben Pedersen, 2009. "Multinational Enterprises from Small Economies: The Internationalization Patterns of Large Companies from Denmark, Finland and Norway," Chapters, in: Daniel Van Den Bulcke & Alain Verbeke & Wenlong Yuan (ed.), Handbook on Small Nations in the Global Economy, chapter 6, Edward Elgar Publishing.
    8. Constantina Kottaridi, 2005. "The 'core-periphery' pattern of FDI-led growth and production structure in the EU," Applied Economics, Taylor & Francis Journals, vol. 37(1), pages 99-113.
    9. Gabriel R. G. Benito, 2005. "Divestment and international business strategy," Journal of Economic Geography, Oxford University Press, vol. 5(2), pages 235-251, April.
    10. Masahisa Fujita & Jacques‐François Thisse, 2003. "Does Geographical Agglomeration Foster Economic Growth? And Who Gains and Loses from It?," The Japanese Economic Review, Japanese Economic Association, vol. 54(2), pages 121-145, June.
    11. Lecraw, Donald J, 1977. "Direct Investment by Firms from Less Developed Countries," Oxford Economic Papers, Oxford University Press, vol. 29(3), pages 442-457, November.
    12. Lall, Sanjaya & Narula, Rajneesh, 2004. "FDI and its role in economic development: Do we need a new agenda?," Research Memorandum 019, Maastricht University, Maastricht Economic Research Institute on Innovation and Technology (MERIT).
    13. Cantwell, John, 1995. "The Globalisation of Technology: What Remains of the Product Cycle Model?," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 19(1), pages 155-174, February.
    14. Rikard Forslid & Ian Wooton, 2003. "Comparative Advantage and the Location of Production," Review of International Economics, Wiley Blackwell, vol. 11(4), pages 588-603, September.
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    Cited by:

    1. Narula, Rajneesh & Van der Straaten, Khadija, 2019. "A comment on the multifaceted relationship between multinational enterprises and within-country inequality," MERIT Working Papers 2019-035, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    2. Narula, Rajneesh & Guimon, Jose, 2010. "The R&D activity of multinational enterprises in peripheral economies: evidence from the EU new member states," MERIT Working Papers 2010-048, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    3. Narula, Rajneesh & Verbeke, Alain, 2015. "Making internalization theory good for practice: The essence of Alan Rugman's contributions to international business," Journal of World Business, Elsevier, vol. 50(4), pages 612-622.
    4. Robert Price & Andreas Wörgötter, 2011. "Estonia: Making the Most of Globalisation," OECD Economics Department Working Papers 876, OECD Publishing.
    5. Olga Petricevic & David J Teece, 2019. "The structural reshaping of globalization: Implications for strategic sectors, profiting from innovation, and the multinational enterprise," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 50(9), pages 1487-1512, December.
    6. Antonios Georgopoulos & Felicitas Nowak-Lehmann D. & Vasilios Sogiakas, 2013. "Survival Characteristics and Adjustment of MNE Affiliates in the European Integrated Market," Ibero America Institute for Econ. Research (IAI) Discussion Papers 225, Ibero-America Institute for Economic Research.
    7. Benoit, Florence & Belderbos, René, 2024. "International connection, local disconnection: The (heterogeneous) role of global cities in local and global innovation networks," Journal of International Management, Elsevier, vol. 30(3).

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    More about this item

    Keywords

    Foreign Direct Investment; Domestic Firm; Multinational Enterprise; Foreign Direct Investment Inflow; Outward Foreign Direct Investment;
    All these keywords.

    JEL classification:

    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • L52 - Industrial Organization - - Regulation and Industrial Policy - - - Industrial Policy; Sectoral Planning Methods
    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights

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