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Which Regions Matter for MNEs? The Role of Regional and Firm Level Differences

Demirbag, Mehmet and Glaister, Keith and Sengupta, Abhijit (2020) 'Which Regions Matter for MNEs? The Role of Regional and Firm Level Differences.' Journal of World Business, 55 (1). ISSN 0022-5428

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Abstract

This paper explores the impact of regional and firm level heterogeneity on MNE performance from an operational perspective. We find that the underlying economic growth of a region and the MNE’s overall product diversity significantly impact returns from downstream operations in specific regions. Based on a 10 year panel dataset of 1249 US based MNEs, results show that the incremental impact of the degree and speed of operations within a given region, is greater for regions exhibiting faster economic growth than for slower growing ones. For slower growing regions only, product diversity of the MNE becomes important and negatively moderates the link between operations and performance. Previous literature has shown that MNEs largely follow a regional strategy and has ignored the role of inter-regional differences, and how firm level characteristics interact with region specific ones. Once inter-regional heterogeneity is introduced, a more complex picture of the internationalization performance link emerges than has been addressed previously, with significant implications for the theory and practise of internationalization.

Item Type: Article
Uncontrolled Keywords: Regional Strategy, Degree of regional operations, Speed of operations, Product Diversity, MNE Performance
Divisions: Faculty of Social Sciences > Essex Business School
Faculty of Social Sciences > Essex Business School > Management Science and Entrepreneurship Group
Depositing User: Elements
Date Deposited: 23 Sep 2019 11:46
Last Modified: 23 Sep 2019 12:15
URI: http://repository.essex.ac.uk/id/eprint/25288

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