To read the full version of this content please select one of the options below:

Global oligopolistic competition and foreign direct investment: Revisiting and extending the literature

Michael W. Hansen (Center for Business and Development Studies, Copenhagen Business School, Frederiksberg, Denmark)
Anne Hoenen (Institute for International Business, University of Vienna, Vienna, Austria)

critical perspectives on international business

ISSN: 1742-2043

Article publication date: 3 October 2016

Downloads
1438

Abstract

Purpose

The purpose of this paper is to re-visit and re-invigorate the oligopolistic industry perspective on multinational corporations (MNC) strategy.

Design/methodology/approach

Based on insights from the industrial organization tradition and strategic management, the paper brings the original insights of the oligopolistic industry perspective into a modern context by outlining a conceptual framework that may guide future international business (IB) research on MNC strategy in oligopolistic industries.

Findings

This paper demonstrates how contemporary IB literature pays little attention to a key insight of the early IB literature, namely, that foreign direct investment (FDI) often is driven by strategic interaction among MNCs in oligopolistic industries. Instead, the contemporary IB literature focuses on the FDI as a way to reduce transaction costs and/or as a way to leverage and build capabilities across borders. The paper argues that progressing global concentration in many industries warrants a rediscovery of the oligopolistic perspective on FDI.

Originality/value

The paper provides a comprehensive and unique literature review of the literature on MNC strategy in oligopolistic industries. Based on this review, the paper develops a novel conceptual framework that may inspire future IB research on MNC strategy in oligopolistic industries.

Keywords

Citation

Hansen, M.W. and Hoenen, A. (2016), "Global oligopolistic competition and foreign direct investment: Revisiting and extending the literature", critical perspectives on international business, Vol. 12 No. 4, pp. 369-387. https://doi.org/10.1108/cpoib-03-2014-0017

Publisher

:

Emerald Group Publishing Limited

Copyright © 2016, Emerald Group Publishing Limited