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Book part
Publication date: 24 June 2015

Sathyajit R. Gubbi and Sinan A. Sular

Outward foreign direct investments (FDI) by Turkish firms in the new millennium show intriguing geographic distribution pattern and unlike the predictions of classical theories of…

Abstract

Outward foreign direct investments (FDI) by Turkish firms in the new millennium show intriguing geographic distribution pattern and unlike the predictions of classical theories of FDI. In this study we contribute by linking the observed pattern of outward FDI with Turkish firms’ motivation for investment across national borders. We enrich research by collecting and analyzing FDI motivation data at the firm-level for a very important but less researched developing country: Turkey. Content analysis of text material on the foreign investments made by 211 Turkish firms reveals that Turkish firms primarily perform FDI in European developed countries for reasons other than conventional, namely, market- and strategic-asset-seeking motivations. More importantly, Turkish firms seem to be using the European countries to (1) present themselves as a European Union company, (2) make use of special features of these countries to expand their businesses within and to other countries and, (3) make use of the favorable tax treatment policies available to foreign investors. Surprisingly, our analysis shows that in spite of its small size, the Netherlands is a preferred destination for Turkish FDI over other Western European countries due to its strategic location and favorable investment policies.

Details

Emerging Economies and Multinational Enterprises
Type: Book
ISBN: 978-1-78441-740-6

Keywords

Book part
Publication date: 25 October 2014

Bent Petersen and Rene E. Seifert

The chapter provides an economic explanation and perspectivation of strategic asset seeking of multinational enterprises from emerging economies (EMNEs) as a prominent feature of…

Abstract

Purpose

The chapter provides an economic explanation and perspectivation of strategic asset seeking of multinational enterprises from emerging economies (EMNEs) as a prominent feature of today’s global economy.

Approach

The authors apply and extend the “springboard perspective.” This perspective submits that EMNEs acquire strategic assets in developed markets primarily for use in their home markets.

Findings

The authors succumb that the springboard perspective is alluring theoretically as well as empirically as it suggests that when EMNEs acquire strategic assets, they experience liabilities of foreignness (LOF) that are low relative to those of MNEs from developed markets. The authors concede to this LOF asymmetry but also point out that liabilities of outsidership (LOO) can offset or weaken the home-market advantage of some EMNEs when competing with MNEs.

Research implications

LOO appears as the more relevant concept to use when explaining strategic asset seeking of EMNEs. A set of propositions are formulated to guide empirical testing.

Originality/value

The insights gained from using the springboard perspective and the LOO concept are non-trivial: They basically predict future dominance of ‘insider’ EMNEs at the expense of MNEs from developed markets.

Details

Multinational Enterprises, Markets and Institutional Diversity
Type: Book
ISBN: 978-1-78441-421-4

Keywords

Book part
Publication date: 24 November 2016

Xiaoyan Luo and Michał K. Lemański

To understand the rationale for foreign direct investment of Chinese electronic companies, their location decisions and entry mode choices

Abstract

Purpose

To understand the rationale for foreign direct investment of Chinese electronic companies, their location decisions and entry mode choices

Methodology/approach

Secondary data on foreign direct investment of the top 100 companies in China’s electronics industry are analysed. The first part covers an exploratory analysis of the industry and the second part presents a comparative longitudinal analysis of three case studies of representative companies: Haier, Huawei, and Lenovo.

Findings

The three key findings are: (1) market-seeking is the primary motivation for foreign direct investment of Chinese companies in the electronics industry, yet the strategic-asset-seeking gains importance as the internationalization of the company advances; (2) foreign investment path normally starts at adjacent foreign markets, but more distant markets are gradually targeted and become more important for the company; (3) wholly owned investments are the preferred market entry modes in the international expansion.

Research limitations/implications

This research is based on secondary data, and more in-depth, interview-based studies are needed to explore the perceptions of decision-makers, and a plethora of contextual factors, which result in specific market entry decisions. As only the 100 largest companies were studied, future research should put under scrutiny also internationalization of smaller firms.

Practical implications

Implications of such findings are discussed in the light of classic internationalization theories as well as the current research on internationalization of companies from emerging/developing countries.

Originality/value

Provides an account of foreign direct investment in a context of a substantial and growing importance for the practice of international business, and identifies an agenda for promising future scholarly inquiries.

Details

The Challenge of Bric Multinationals
Type: Book
ISBN: 978-1-78635-350-4

Keywords

Book part
Publication date: 16 November 2012

Nimet Uray, Nukhet Vardar and Ramazan Nacar

Purpose – The main aim of this chapter is to identify the factors that motivate outward Foreign Direct Investment (FDI) from Turkey to EU countries, looking into the problem at…

Abstract

Purpose – The main aim of this chapter is to identify the factors that motivate outward Foreign Direct Investment (FDI) from Turkey to EU countries, looking into the problem at the firm level with a marketing focus, trying to understand whether or not there are any Turkey-specific prevailing marketing-related drivers.

Design/methodology/approach – With a distinction between developed and emerging/developing countries and their MNCs’ role in world trade and FDI, the literature review focuses on micro-view motives, particularly marketing-related ones, rather than macro-view motives which are mostly studied in the literature. Based on the literature review, the importance of Turkish MNCs and their increasing role in the world trade is briefly summarized.

Looking into the problem at the firm level with a marketing focus, a series of in-depth interviews with top executives were conducted as an exploratory study in order to explore and understand the role of marketing-related motives in Outward Foreign Direct Investment (OFDI) decisions of Turkish MNCs. For this purpose, 10 in-depth interviews with 13 top executives were conducted with tailor-made questionnaires.

Findings – The analysis of interviews revealed some different OFDI drivers and motivations for the Turkish MNCs compared to the factors mentioned in the literature, as well as iterating some common motives with the OFDI literature. Parallel to the FDI literature, it is observed that the Turkish MNCs mainly started their internationalization attempts by taking somewhat less risky and smaller steps.

As a result of qualitative research, the support is provided for the theoretical perspective that micro variables are more important than macro variables for Emerging Multinationals (EMNCs), particularly for Turkish MNCs; therefore, some Turkey-specific motives were also identified.

Originality/value of chapter – Although there is a consensus in recent literature on the most persistent group of motives influencing OFDI activities of EMNCs in developed countries, the underlying marketing-related objectives which are crucial to sustain competitive advantage have not been analysed and investigated sufficiently. This study is an attempt to fill this gap by identifying the most persistent marketing-related motives and give important insights about country-specific ones encouraging Turkish EMNCs to carry out OFDI in EU.

Details

New Policy Challenges for European Multinationals
Type: Book
ISBN: 978-1-78190-020-8

Keywords

Book part
Publication date: 24 August 2022

Florian Becker-Ritterspach

Current gazelle and high growth firm (HGF) research provides relatively little systematic knowledge if, how, why firm internationalization facilitates accelerated growth. This…

Abstract

Current gazelle and high growth firm (HGF) research provides relatively little systematic knowledge if, how, why firm internationalization facilitates accelerated growth. This chapter aims at providing such an insight by addressing the following three questions: (1) What is the evidence of internationalization as an determinant of HGF; (2) How does internationalization facilitates fast growth?; (3) What do we know about the circumstance under which internationalization contributes to HGF? The chapter concludes that while there is clear evidence that internationalization and its different modes can be important determinants of accelerated firm growth, our knowledge remains limited on how different circumstances of the firm at the micro-, meso- and macro-level interact to condition growth opportunities through internationalization.

Details

The Promises and Properties of Rapidly Growing Companies: Gazelles
Type: Book
ISBN: 978-1-80117-819-8

Keywords

Book part
Publication date: 24 November 2016

Liliana Rodriguez-Arango and Maria Alejandra Gonzalez-Perez

This chapter aims to provide a descriptive analysis and a theoretical interpretation of the challenges for international expansion of four large multinationals of each of the BRIC…

Abstract

Purpose

This chapter aims to provide a descriptive analysis and a theoretical interpretation of the challenges for international expansion of four large multinationals of each of the BRIC countries (JBS from Brazil, VimpelCom from Russia, Tata Motors from India, and Lenovo from China).

Methodology/approach

This study employs a qualitative approach, following a multiple-case study methodology, by analyzing four prominent cases of the internationalization of BRIC multinationals.

Findings

The internationalization process of the studied BRIC multinationals was influenced by the type of inputs and resources that each company had in their home country and the search for needed resources in other firms abroad that may have helped them to complement their business assets. The international expansion of these firms have been characterized by overcoming of several obstacles through the possession of firm-specific advantages, mainly composed of managerial capabilities, expertise, and knowledge about the markets and their companies.

Details

The Challenge of Bric Multinationals
Type: Book
ISBN: 978-1-78635-350-4

Keywords

Abstract

Details

Internationalization of Firms: The Role of Institutional Distance on Location and Entry mode
Type: Book
ISBN: 978-1-78714-134-6

Abstract

Details

Internationalization of Firms: The Role of Institutional Distance on Location and Entry mode
Type: Book
ISBN: 978-1-78714-134-6

Book part
Publication date: 27 November 2006

Esther Sánchez Peinado and José Pla Barber

Despite the importance of the service sector in developed economies and the growth of foreign investments in this sector during the last decade, few studies have undertaken to…

Abstract

Despite the importance of the service sector in developed economies and the growth of foreign investments in this sector during the last decade, few studies have undertaken to empirically analyze the factors influencing entry mode choice. The special characteristics of the service sector increase the complexity of the analysis and, thus, traditional explanations of entry mode choice in manufacturing sectors may need to be complemented by other moderating influences. Based on 174 entry decisions of service firms, our results suggest the importance of including strategic variables and the specific nature of services to understand a complex phenomenon, which is not always associated just with efficiency and value-based considerations but also with strategic issues and industry characteristics.

Details

International Marketing Research
Type: Book
ISBN: 978-0-76231-369-3

Content available
Book part
Publication date: 24 August 2022

Abstract

Details

The Promises and Properties of Rapidly Growing Companies: Gazelles
Type: Book
ISBN: 978-1-80117-819-8

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