Knowledge that Transforms

This article discusses the implications of the advent of alliance capitalism for our theorizing about the determinants of MNE activity. In particular, it argues that, due to the increasing porosity of the boundaries of firms, countries and markets, the eclectic, or OLI, paradigm of international production needs to consider more explicitly the competitive advantages arising from the way firms organize their inter-firm transactions, the growing interdependencies of many intermediate product markets, and the widening of the portfolio of the assets of districts, regions and countries to embrace the external economies of interdependent activities.

This study examined the effects of policy and non-policy variables on the location of new U.S. direct investment abroad (as distinct from reinvested earnings of existing affiliates), using 1977 and 1982 Benchmark data. The data revealed statistically significant effects for investment incentives (positive), performance requirements (negative), and host country effective tax rates (negative) with interesting differences between the two time periods and between developed versus developing countries. Significance was also found for non-policy variables such as political stability, cultural distance, GDP per capita, and infrastructure.

In spite of the increasing popularity of international joint ventures, managers express a high level of dissatisfaction with them. This paper argues that overemphasis on the outcome has resulted in a neglect of the social processes underlying the outcome. The paper elaborates upon the rationale for a cooperative approach towards interorganizational collaborative relationships based on trust, and discusses it in the context of joint ventures. This is then applied towards understanding multinational ownership preferences and tolerance for joint ventures. It is argued that trust-centered logic is largely consistent with approaches that emphasize the issue of ownership, and deepens and enriches the insights provided by the latter. A shift in focus from ownership to relational dynamics is encouraged.

This paper tests whether the pattern of related and unrelated acquisitions is consistent with the existence of cost disadvantages to cross-border investing. Data from the U.S. chemical industry (1978–89) are consistent with the implications that foreign investors are more likely than domestic investors to make closely related acquisitions. The data also indicate that U.S. FTC antitrust policy affected the pattern of domestic acquisitions.

Foreign postings for executives are costly undertakings for multinational corporations, especially when they fail. Yet little research has been done on the causes of expatriate turnover. This 155-expatriate survey assesses individual, organizational/work and environmental influences on both internal and external turnover tendencies. It was found that job autonomy and material life satisfaction were key predictors for both internal and external turnover tendencies. Only for organizational turnover did job autonomy supersede material life satisfaction as the lead predictor of turnover tendencies. American expatriates attach much importance to maintaining living standards in postings to foreign locations.