Electronic Thesis and Dissertation Repository

Degree

Doctor of Philosophy

Program

Business

Supervisor

Paul W. Beamish

Abstract

This dissertation investigates some of the antecedents and consequences of stability and change in multinational enterprises (MNEs). It focuses on the strategic level decisions of MNEs in their international activities. Essay 1 studies the role of the development and deployment of decision rules, as an organizational capability, since they may lead to consistency and stability in MNEs’ international strategies. By focusing on recurring and high-stakes strategic resource allocation decisions, the study disentangles the time and space dimensions of the deployment of capabilities. The findings indicate a positive effect on performance for MNEs’ spatial consistency across subsidiaries for expatriation (as a repetitive decision), and a negative effect for spatial consistency in equity ownership (as a quasi-repetitive decision). The study also observes a positive effect on performance for temporal persistence in expatriation.

Regarding the consequences of stability and change, Essays 2 and 3 investigate the MNE’s evolution in the global space and the knowledge it acquires and amasses in its knowledge-base. This knowledge-base transcends the learning lessons originating from a firm’s home country to a broader evolved home-base which incorporates all foreign subsidiaries of the MNE and its home country. Distance as a highly popular concept in international business is then revisited and reconceptualized. Essays 2 and 3 argue that the internationalization process of the firm shifts its reliance on the original home country as a source of knowledge, to the broader domain of the MNE’s activities and the portfolio of its locations. It may either rely on the knowledge from all its subsidiary locations, or on the learnings from the most similar location in the portfolio to the focal host country. These two approaches lead to theoretical development of two (multilevel) distance constructs at the MNE level: average distance measure based on a composition approach and minimum distance measure using a compilation approach. The former has already been introduced in the literature and the latter is a newly introduced and developed measure in this dissertation. Essay 3 provides a comparative analysis to compare the predictive power of the new and extant distance measures. Overall, the findings of this dissertation indicate the superiority (and complementarity) of the two MNE-level distance measures.

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