IDEAS home Printed from https://ideas.repec.org/h/pal/palchp/978-1-4039-8057-1_8.html
   My bibliography  Save this book chapter

Managing Relationships with the Indian Government: The Critical Challenges for Multinational Firms

In: Doing Business in India

Author

Listed:
  • Rajesh Kumar
  • Anand Kumar Sethi

Abstract

Historically, the relationship between multinational firms and developing countries has been that of conflict.1 This “conflict” view found its expression in the “obsolescence bargaining model” developed by Raymond Vernon.2 This model conceptualized the relationship between multinational firms and host countries in terms of the key construct of bargaining power. When a multinational firm first enters a host country, it has the bargaining advantage at the point of entry but this advantage is lost once the multinational firm invests in the country. The fixed assets of the firm now become a hostage to the policies of the host country and the government can potentially alter the terms of the new bargain in its favor. This framework was originally applied to explain the expropriation of assets of multinational firms active in the natural resources sector. Subsequently, the framework was utilized for explaining investment of multinational firms in the manufacturing sector but with much less convincing results.3

Suggested Citation

  • Rajesh Kumar & Anand Kumar Sethi, 2005. "Managing Relationships with the Indian Government: The Critical Challenges for Multinational Firms," Palgrave Macmillan Books, in: Doing Business in India, chapter 0, pages 115-129, Palgrave Macmillan.
    • Handle: RePEc:pal:palchp:978-1-4039-8057-1_8
    DOI: 10.1007/978-1-4039-8057-1_8
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    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:pal:palchp:978-1-4039-8057-1_8. 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.

    We have no bibliographic references for this item. You can help adding them by using 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: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.palgrave.com .

    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.