Resource Availability And Firm's International Strategy As Key Determinants Of Entry Mode Choice

Tulung, Joy Elly (2016): Resource Availability And Firm's International Strategy As Key Determinants Of Entry Mode Choice. Published in: Jurnal Aplikasi Manajemen , Vol. 15, No. 1 (March 2017): pp. 160-168.

Abstract

This study aimed to focus on the relationship between two main MNE’s strategies that were multi-domestic and global. The choice of entry that examined not only the basis of Transaction Cost and Resource Based View but also incorporates a concept of Integration and Adaptation Cost. Moreover, the study includes an analysis brownfield investment and presents it as an alternative investment model in transition/emerging economies. This study examined by multi-domestic and the global strategy that were majority MNEs. Companies following a multi-domestic strategy will mostly depend on local firm’s resources, such as local technology, local brand name, networking, and distribution channels. Their main purpose is to respond to the local market demands, which can best be achieved by the local subsidiaries of well-integrated. This study was a purely conceptual literature review, which is based on a substantial number of scientific and conceptual articles. This study decided to concentrate on the relationship between the resources, strategies and entry modes (including brownfield investment) because this study discovered a large research/literature gap in this field that very exciting.

• Item Type: MPRA Paper
• Language: English
• Keywords: entry modes, MNE’s strategies, transaction cost, resource based view, integration, adaptation cost
• Subjects: F - International Economics > F2 - International Factor Movements and International Business > F23 - Multinational Firms ; International Business; G - Financial Economics > G3 - Corporate Finance and Governance

References

Anderson, E., & Gatignon, H. 1986. Modes of foreign entry: A transaction cost analysis and propositions. Journal of International Business Studies 17 (3):1-26.

Barney, J.B. 1986. Strategic factor markets: Expectations, luck and business strategy. Management Science 32 (10):1231-1241.

Caves, R.E. 1982. Multinational Enterprise and Economic Analysis. Cambridge: Cambridge University Press.

Cheng, Young-Ming. 2006. Determinants of FDI Mode Choice: Acquisition, Brownfield, and Greenfield Entry in Foreign Markets. Canadian Journal of Administrative Sciences 23 (3):202-220.

DiMaggio, P., & W. Powell. 1983. The iron cage revisited: institutional and collective rationality in organizational fields. American Sociological Review 48:147-160.

Dikova, D., and van Witteloostuijn, A. 2007. Foreign direct investment mode choice: Entry and establishment modes in transition economies. Journal of International Business Studies advance online publication, doi:10.1057/palgrave.jibs.8400297.

Egelhoff, William. 1990. Review of Managing across borders: The Transnational Solution. Sloan Management Review 2003.

Estrin, S., Hughes, K., & Todd, S. 1997. Foreign Direct Investment in Central and Eastern Europe, London: Cassel.

Glückler, J. 2005. A relational assessment of international market entry in management consulting. Journal of Economic Geography 6: 369-393.

Harzing, A.W.K. 2000. An empirical analysis and extension of the Bartlett and Ghoshal typology of multinational companies. Journal of International Business Studies 31 (1):101-120.

Harzing, A.W.K. 2002. Acquisitions versus greenfield investments: international strategy and management of entry modes. Strategic Management Journal 23 (3):211-227.

Hill, C.W.L. 1990. Cooperation, Opportunism, and the Invisible Hand: Implications for Transaction Cost Theory. Academy of Management Review 15 (3): 500- 513.

Kogut, B., & Singh, H. 1988. The effect of National Culture on The Choice of Entry Mode. Journal of International Business Studies 19 (3) 411-432.

Meyer, K.E., & Estrin, S. 2001. Brownfield entry in emerging markets. Journal of International Business Studies 32 (3):575-584.

Penrose, E. 1959. The Theory of the Growth of the Firm, 3rd edition with the New Preface. London: Oxford University Press.

Rosenzweig, P.M., & Singh, J.V. 1991. Organizational Environments and The Multinational Enterprise. Academy of Management Review 16 (2):340-361.

Wright, P.M., & McMahan, G.C. 1992. Theoretical perspectives for strategic human resource management. Journal of Management 18 (2):295-320.