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Emerging market multinationals and the concept of ownership advantages

Peter Williamson (International Management, Cambridge Judge Business School, University of Cambridge, Cambridge, UK)
Feng Wan (Norwich Business School, University of East Anglia, Norwich, UK)

International Journal of Emerging Markets

ISSN: 1746-8809

Article publication date: 16 July 2018

1948

Abstract

Purpose

The purpose of this paper is to re-assess the concept of ownership advantages in the light of successful international expansion of multinationals from emerging economies (EMNEs) and explore how these advantages are built.

Design/methodology/approach

The paper presents a viewpoint based on analysis of the successful international expansion of a sample of Chinese EMNEs where success is measured their ability win share in overseas markets. This allows us to identify their ownership advantages, the antecedents of these advantages and how they were built using dynamic capabilities.

Findings

EMNEs have “non-traditional” ownership advantages that have been built by finding innovative ways to leverage the locational advantages of their home countries. The conversion of locational advantages into ownership advantages requires that firms build dynamic capabilities that enable them to innovate in the use of the locational advantages they enjoy.

Research limitations/implications

The study is limited to a small sample of EMNEs from China who have succeeded in winning market share in the initial phases of their international expansion. In the light of these limitations, the authors discuss the question the sustainability of their competitive advantage as well as the likely applicability of our findings to EMNEs from other EMNEs.

Originality/value

The authors revisit the paradox that despite the growth and success of multinationals from EMNEs in the past decade they are assumed to lack ownership advantages. The authors show that EMNEs’ ownership advantages differ from the traditional advantages such proprietary technologies and brand equity that are enjoyed by incumbent multinationals.

Keywords

Citation

Williamson, P. and Wan, F. (2018), "Emerging market multinationals and the concept of ownership advantages", International Journal of Emerging Markets, Vol. 13 No. 3, pp. 557-567. https://doi.org/10.1108/IJoEM-08-2017-0319

Publisher

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Emerald Publishing Limited

Copyright © 2018, Emerald Publishing Limited

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