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Our study proposes a resource environment view (REV) of competitive advantage by unpacking the environmental origins of a firm’s competitive advantage. The key tenet of the REV is that the heterogeneity and imperfect mobility of strategic factor markets and institutions across countries explain how firms based in different countries would likely both create and sustain a competitive advantage. In particular, our study introduces the notion of “the paradox of environmental embeddedness.” The paradox lies in the fact that the same environmental conditions – in terms of strategic factor markets and institutions – that enable firms to create a competitive advantage can paradoxically also create a situation in which it is more difficult for these firms to sustain an advantage. Another important aspect of our study is that, to enhance our understanding of how firms manage the paradox of environmental embeddedness, our study specifies the resource environmental conditions under which firms’ internal and external resource-oriented strategies – that is, the development of dynamic capabilities and interventions in the country resource environment – are more beneficial when managing the environmental paradox. Overall, our theorizing has important implications for strategic management theory and practice.

Prior research on international diversification has focused primarily on multinational enterprises (MNEs) from developed economies, such as the U.S. and other developed nations. As an increasing number of MNEs are now located in emerging economies, new theoretical frameworks are needed to better understand the motivations of these MNEs to diversify internationally. This paper contributes to the theory development of MNEs by examining the characteristics of international diversification by business groups from emerging economies. Using the resource-based view (RBV) of the firm and organizational learning theory, we suggest that the international diversification motives of business groups from emerging economies vary by host country context. Business groups from emerging economies are more likely to enter developed economies (rather than other emerging economies) when their primary aim is exploring new resources and capabilities, and more likely to enter other emerging economies (rather than developed economies) when their primary aim is to exploit existing group resources and capabilities. We also suggest that these motives influence business-group performance. We identify two important moderators of these relationships: product diversification and social capital. Because of the importance of the business-group organizational form in emerging economies, understanding business-group international diversification may lead to improved MNE theory.

This study focuses on home country institutions as sources of variation in the level of foreign investment into India. Our findings support the idea that institutional voids found in India are less of a deterrent to investments from home countries with high levels of institutional development than from home countries with similar institutional voids. Overall, foreign investments in India are found to be significantly related to the strength of institutions within home countries. The levels of both approved and realized foreign direct investment (FDI) are strongly influenced by economic factors and home country regulative institutions, and weakly influenced by home country cognitive institutions. When considered separately, the cognitive institutions and regulative institutions within a given home country each significantly influence the level of approved/realized FDI into India. However, when considered jointly, only the strength of regulative institutions is predictive of FDI inflows.

This paper analyzes five characteristics associated with the overall decision‐making process that are necessary to achieve a high degree of perceived procedural justice within four strategic contexts of focal subsidiaries. Strategic contexts are based on the role of subsidiaries as defined by the flow of knowledge between these subsidiaries and the global network of MNCs. Propositions are developed that relate the five characteristics, the four strategic contexts, and high perceived procedural justice. The propositions represent a template for managers and researchers interested in the successful implementation of global strategic decisions and the improvement of the performance of individual subsidiaries as well as the global competitiveness of multinational corporations.

This chapter examines the interrelationships among pre-merger acquisition strategy, target resistance and post-merger integration and the effects of these interrelationships on post-merger performance. Perspectives from financial and strategic management theory are combined to suggest that an interaction effect of pre-merger and post-merger activities more fully explains merged firm performance, especially in cases in which the acquiring'firm is related to the target. Relatedness between acquiring and target firms is more likely to lead to operating synergy, which may increase performance. However, potential positive effects from synergy are likely to be offset by resistance from target firm executives, which may lead to premium-increasing tactics, such as bidder solicitation or holding out for a higher price, or, in the post-merger stage, integration difficulties.

The liability of foreignness has long been acknowledged as a key concept in international business research. Departing from the cost side of foreignness, this chapter explores intangible benefits of foreignness exclusive to multinational enterprises in a host country in addition to tangible benefits such as preferential tax policies. Intangible benefits of foreignness are defined as advantages of foreignness so as to distinguish from assets of foreignness – tangible benefits of foreignness. Drawing on institutional theory and social comparison theory, we propose that advantages of foreignness can lead to important firm-specific performance-related outcomes, which have been generally underestimated in the international business literature.