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There are two leading paradigms about the power balance between multinational corporations (MNCs) and states. The MNCs in Command approach takes the perspective that MNCs dominate states. The States in Command perspective assumes that states lord over MNCs. Each perspective suffers from noteworthy flaws. I advocate a modified bargaining power (MBP) approach to understanding the relative power of MNCs and states. I test the value of this approach by examining Microsoft's experience in China between 1987 and 2004. My study shows that that a MBP approach sheds considerable light on the aforementioned case, whereas the two leading paradigms do not.

The purpose of this paper is to explore the relationship between effective knowledge management and corporate performance, to explore the dynamic symbiosis phenomenon of effective knowledge management based on organizational ecology with multinational companies (MNCs) and non-multinational companies (non-MNCs) and to explore the symbiosis strategy of knowledge management between multinational and non-multinational companies (non-MNCs) in China.

To measure effective knowledge management, this paper first uses structural equation model to measure knowledge management, based on the evolution dynamics equation in organizational ecology to measure the effectiveness of knowledge management, and studies the symbiosis of effective knowledge management between MNCs and non-MNCs based on ecological perspective.

Effective knowledge management can promote the financial performance of enterprises, but different degrees of effectiveness have different effects. In addition, the coupling and collaboration between knowledge management and corporate performance can reflect the value of effective knowledge management. The results show that effective knowledge management plays a positive moderating effect between knowledge management and corporate performance. Finally, the effective knowledge management system of MNCs (non-MNCs) has negative effect on non-MNCs (MNCs), showing the exclusive relationship between MNCs and non-MNCs in China.

The effectiveness of knowledge management is only based on the measurement of financial performance coupling. For other types of performance, it needs to be tested. The samples may not cover symbiosis relationship of effective knowledge management in other countries.

This paper provides practical and theoretical reference for confirming the symbiotic interaction and identifying the opportunities and challenges of knowledge management among different types of corporation groups.

The paper is one of the pioneering studies to explore the pattern of symbiotic evolution of effective knowledge management between MNCs and non-MNCs. From completely new perspectives, this study advances the research of knowledge management to a new and promising area.

This paper focuses on the firm‐specific assets, management processes, and organizational strategies displayed by a group of firms based in Latin America, a region that undertook a generalized attempt of economic liberalization during the 1990s. We analyze the operational and organizational strategies of 40 local firms with rapidly expanding international operations within the region – defined as “multilatinas” – and contrast them with those of 58 U.S. and European multinational corporations also operating in Latin America. By comparing these two sets of firms – emerging and experienced – in the same context and over the same time period, we can test for the universality of models of organizational change that are based largely on the latter. We show that multilatinas enjoy less firm‐specific assets and make less extensive use of sophisticated management processes than their foreign counterparts. We also see, however, many of these emerging multinationals evolving by adopting more complex coordination and control mechanisms as they face a more integrated and global environment.

The multilingual MNC provides a promising territory for enhancing the dialogue between organization theory and International Business. We draw parallels between research on the multinational corporation and that on the multilingual corporation. Our review shows that the changing conceptualizations of the MNC toward a network model have carved space for language-sensitive research in International Business. We scrutinize this stream of research from the viewpoint of three organization theory lenses: the role of language in organizational design and architecture, in identity building and culture, and in organizational political systems, and comment on future research.

Relationships between multinational corporations (MNCs) and developing nations are known to have benefits as well as costs, particularly for the host country. The purpose of this study was to investigate the perceptions of managers on the effects of MNCs on a developing nation. Using a sample of 1344 Arab and non‐Arab managers in Kuwait, the authors find the respondents perceive positive effects of MNCs on the business‐economic, legal‐political, and technological environments of the country. However, the effects of MNCs on the social‐cultural environment in Kuwait are perceived as negative. The authors recommend that MNCs operating in Kuwait be sensitive to these perceptions to ensure harmony in future business ventures.

The purpose of this paper is to explore how multinationality affects multinational companies’ (MNCs) downside risk and the moderate effects of ownership structure in the setting of emerging markets based on Chinese publicly traded manufacturing MNCs.

The author derives hypotheses based on real options theory and agency theory, and tests hypotheses by using Tobit model and a unique data set of Chinese A-shared publicly traded manufacturing MNCs in the period of 2010–2016.

The empirical results suggest that multinationality is positively related to downside risk and this effect is subjected to ownership structure for firms in emerging markets. In particular, multinationality of MNCs with a high level of ownership concentration, managerial ownership and institutional ownership is more likely to reduce downside risk.

The main conclusion of this paper highlights the importance of ownership structure of MNCs in explaining the real options value of multinationality, and conveys to owners of MNCs in China and other emerging markets the need to strengthen firms’ governance if they want to maximize the benefits of multinational operations.

This study extends existing studies by taking ownership structure into consideration and highlighting the importance of agency problem in the examination of multinationality and downside risk, which provides a potential explanation for previous mixed evidence. This study also provides new evidence for the relationship between multinationality and downside risk by using a unique sample from China, an emerging market country.

The purpose of this study is to address the relationship between multinational corporations (MNCs) and grand challenges. Stressing the moderating impact of stakeholders and governments, it frames and introduces the six contributions of the special issue, equally divided into those illustrating how MNCs contribute to the existence of grand challenges and those exploring how MNCs contribute to addressing grand challenges.

Based on a review of the existing literature on the relationship between MNCs and grand challenges and recent developments in mainstream international business, the viewpoint emphasizes the need to move beyond a one-sided focus on the positive contributions of MNCs to grand challenges.

The special issue contributions reveal that even established MNCs are actively engaged in strategic efforts to perpetuate unsustainable practices and minimize the impact of societal rules and stakeholders. The contributions also highlight the complications when MNCs aim to tackle grand challenges.

Displaying positive practices of how MNCs contribute to the solution of grand challenges should not be considered a functional substitute for regulatory action, contrary to the frequent assertion of MNCs and their political representatives.

This special issue is the first one in IB to address the relationship between MNCs and grand challenges from an empirical vantage point.

The purpose of this paper is to examine whether Korean multinational corporations (MNCs) in the electronics and steel industries do shift their production across their foreign subsidiaries, located in different countries, as exchange rates fluctuate in foreign countries.

A case study was taken as a qualitative methodology to examine whether MNCs actually shift their production as multinational operational flexibility perspective predicts.

From a case study of two Korean MNCs (LG Electronics and POSCO), it was found that even facing heightened production costs associated with host country currency appreciation, Korean MNCs do not shift their production to less costly locations due to industrial characteristics, limited capacity, and high tariff barriers. It was also found that they reduce the production costs internally and they also negotiate the costs with employees and suppliers to adjust the production costs associated with appreciated currency.

Our findings imply that certain industrial and environmental constraints make it difficult for MNCs to take flexible actions as multinational operational flexibility perspective predicts. The findings also shed additional light on the less‐explored argument over operational flexibility and vertical integration associated with cross‐country shifts of value chain activities, including production or sales.

Almost all literature taking the multinational operation flexibility view argues that MNCs are able to shift their productions for their own benefits. However, the authors of this paper find from their case studies that firms take advantage of other methods than production shifts in their responses to exchange rate fluctuations in their host countries. Thus this study gives an insight into when and how firms behave as the theory predicts.

Agency problems are more severe for multinational corporations (MNCs) and multinational enterprises compared to their domestic counterparts. As companies develop diversified operations, their managers face more challenges. An incentive compensation structure has been designed to align the benefits of managers with those of shareholders. Additionally, corporate social responsibility (CSR) has become increasingly crucial for companies. MNCs must gain the trust of more investors to improve their corporate reputation and financial performance. CSR enables MNCs with a high sense of social responsibility to expand their investor base, reduce perceived risks, and decrease information asymmetry. Our empirical findings reveal that Taiwanese MNCs can enhance their performance by implementing cash-based compensation and pursuing CSR activities.