Search results

Aim of the present monograph is the economic analysis of the role of MNEs regarding globalisation and digital economy and in parallel there is a reference and examination of some legal aspects concerning MNEs, cyberspace and e‐commerce as the means of expression of the digital economy. The whole effort of the author is focused on the examination of various aspects of MNEs and their impact upon globalisation and vice versa and how and if we are moving towards a global digital economy.

The purpose of this paper is to provide new empirical evidence on the performance of multinational banks as a subset of the eclectic theory.

The paper employs the least square method of random effects model (REM). The opportunity to use a random effects rather than a fixed effects model has been tested with the Hausman test. To control for cross‐section heteroscedasticity of the variables, the study employs White's transformation.

The empirical findings indicate that credit risk, overhead costs, income from non‐traditional sources, and loans intensity contribute positively to the profitability of the foreign subsidiaries. The results seem to suggest that the parent bank's branch networks exert positive influence on their foreign subsidiaries in India, while the size of the parent banks negatively influences their Indian subsidiaries’ performance.

Due to its limitations, the present study could be extended in a variety of ways. First, future research could include more variables such as taxation and regulation indicators, and exchange rates as well as indicators of the quality of the offered services. Second, future studies could also examine the differences in the determinants of profitability between small and large or high and low profitability banks. Third, in terms of methodology, frontier optimization techniques such as the data envelopment analysis, the stochastic frontier analysis, and/or the Malmquist productivity index methods are recommended to examine the performance of the foreign subsidiaries of multinational banks operating in the Indian banking sector.

Studies on the potential benefit of foreign bank entry have been studied extensively. Still, little is known about in which type of country, and under which circumstances, foreign banks have an advantage over their domestic bank peers. Furthermore, Claessens and van Horen point out that the recent financial crisis has highlighted risks associated with cross‐border banking and foreign banks presence. These developments have led to greater interest among policy makers and academicians for more analyses to help guide regulatory reform.

The empirical works concerning multinational banking have mainly focused on the determinants and methods of multinational banks entry into foreign markets. On the other hand, empirical evidence on the performance of multinational banks as a subset of the eclectic theory is scarce. By using the whole gamut of foreign subsidiaries of multinational banks operating in the Indian banking sector during the period 2000 to 2008, the paper contributes to this line of the literature.

The relationship between diversification and organizational performance has been the subject of numerous studies over the years (Palepu, 1985; Rumelt, 1974). However, strategy scholars have universally defined diversification using a narrow definition, namely that corporate diversification is a function or reflection of the number of products/businesses in a firm's portfolio. The present study argues that such a definition has become outdated given the impact of international market diversification (Kim, Hwang, & Burgers, 1989; Rugman, 1979). Integrating these two views of corporate diversification, we investigate diversification‐performance differences using market‐ and product‐based measures of diversification and an international sample. Results suggest that the traditional model of diversification may not be applicable to all countries and that international differences exist.

Business research has highlighted the importance of knowledge transfer and innovation in multinational firms for better performance outcomes. However, the existing body of literature is characterized by differentiated theories, antecedents and outcomes. This study aims to address this gap by adopting a systematic approach to analyze knowledge transfer and innovation literature from the perspective of multinational organizations.

This study follows “preferred reporting items for systematic reviews and meta-analyses” (PRISMA) guidelines for conducting a systematic literature review. The study adopts a systematic approach for analyzing the literature using School of thought (S), Contexts (C), Methodologies (M), Triggers (T), Barriers (B), Facilitators (F) and Outcomes (O) framework (SCM-TBFO framework) devised for holistic literature review. The study analyzes 75 articles from reputed journals from 2000 to 2022.

In general, knowledge transfer and innovation in multinationals is a relatively new area and is evolving rapidly. There are many opportunities to study the various perspectives that are included in the SCM-TBFO framework. The key schools of thought included the evolutionary theory of innovation, institutional theory and internationalization theory. The studies had differing settings or contexts, including China, Europe, the USA and Taiwan. Further, key methodologies that were used included regression, case studies, structural equation modeling (SEM) and theoretical studies. Knowledge transfer and innovation triggers included competitive advantage, competitive pressure, constant requirements for better products and services, foreign direct investment (FDI) and globalization. Knowledge transfer and innovation facilitators were categorized into strategy-related facilitators, organization culture and orientation-related facilitators, and resource-related facilitators. Knowledge transfer and innovation barriers included autonomy, international knowledge dispersion, risk of knowledge leakage, search breadth, ambiguity and institutional voids. Key outcomes of knowledge transfer and innovation in multinationals included financial performance, innovation performance, knowledge flow, transfer effectiveness, patents and new product development.

By synthesizing the literature, the study aims to provide an overview of the current state of research on knowledge transfer and innovation in multinationals. The study develops a holistic model for fostering knowledge transfer and innovation in multinationals. The proposed novel framework can also be applied to perform a holistic assessment of the current literature in various research domains. Further, the study suggests future theory development and research agendas. The study also provides implications for practitioners using the framework to achieve more desirable outcomes.

We examined the effects of group structure and electronic communication patterns on the performance of 18 multinational teams over an 8-month period. The teams were composed of a mix of Western and non-Western executives located throughout the world. In these highly diverse teams, team performance did not vary as a function of demographic heterogeneity; however, demographic homogeneity within the teams’ subgroups negatively affected team performance. The following communication patterns were associated with better team performance: a hierarchical communication structure, expressions of trust in the team's competence, references to the self, and information-providing statements.

This study analyzes the relationship between multinationality and performance of 1,247 US multinational enterprises (MNEs) over the period of 1995‐2004 by utilizing Tobin’s q theory. Internationalization is a double‐edged sword: foreign intangible assets create a firm’s value, while, at the same time, internationalization itself degrades the value by raising transaction costs and uncertainty in foreign operations. The empirical results show that US MNEs cannot increase their performance merely by developing their intangible assets in the rest of the home region (Canada and Mexico). Conversely, US MNEs rarely suffer from a liability of foreignness in their home region.

This chapter contends that the international business (IB) and strategic management (SM) fields have many commonalities that should be considered in a turbulent globalized business context. IB studies refer to the need for local integration and local adaptation whereas empirics in SM pinpoint the complementary effects of central planning and decentralized decision-making. We present and synthesize these rather field specific perspectives and try to synthesize insights from both fields in an adaptive strategy-making model including the effects of autonomous subsidiary initiatives and intended mandates from corporate headquarters. The model considers local subsidiary actions of both operational and strategic nature and we argue that it may be futile to distinguish between these effects as incremental operational responses can cumulate into more substantial changes over time with dimensions of strategic adaptation. The model provides a foundation for further considerations about how to combine central intent and direction with decentralization and autonomous initiatives in the multinational corporation.

In this chapter, we explore the interrelationships between team member cultural intelligence (CQ) and multinational team functioning and performance. We argue that CQ, an individual's capability to adapt to different cultural contexts, can be enhanced through experience working in a multinational team, suggesting that CQ is not simply a stable individual difference. We propose a conceptual framework, and demonstrate empirical support through a longitudinal study, that links the effectiveness of team experience to shared norms and positive performance feedback. Additionally, we present evidence that mean level of team member CQ predicts intragroup trust, cohesion, and performance for the multinational team.

A large and robust empirical literature demonstrates that there is a strong relationship between the performance of a multinational enterprise (MNE) and its degree of multinationality. We develop a new metric to capture the return on foreign assets (ROFA), which we use as an alternative metric to return on total assets (ROTA) as a dependent variable representing performance. We find a significant S‐shaped relation between ROFA and the degree of multinationality across a large set of UK firms.

The purpose of this paper is to investigate the relationship between international diversification (ID) and performance in multinational firms by proposing a new and unified theory of multinationality that incorporates, integrates and extends previous concepts and hypotheses.

The study relies on data concerning the world’s largest companies, derived from the Fortune Global 500. An OLS regression analysis has been carried out in order to test a four-stage relationship between ID and performance.

On a final sample of 391 multinationals, this paper provides an empirical evidence that support the existence of a four-stage theory by using a relevant sample of “top” multinational firms.

This study has two main limitations: first, a single indicator was used to measure ID; second, some potential variables have had to be excluded due to data availability.

This paper offers some intriguing practical implications, as well: first, it points out to some thresholds where performances are higher at certain level of ID; second, it highlights that performance will face two kinds of decreases due to intra-regional and inter-regional liability of foreignness; finally, it individuates differences with regard to some firms’ characteristics such as home or host country’s behaviors and about the kind of industries in which they operate, as well.

This is one of the first studies that tests and finds positive evidences about a four-stage theory, regarding to the relationship between ID and performance. Moreover, it proposes other interesting results with regard to the differences between home vs host country-oriented firms and between manufacturing vs services multinational firms.