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The contribution of foreign subsidiaries to host country national competitiveness

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  • O'Donnell, Sharon
  • Blumentritt, Timothy
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    Abstract

    In this article, we develop a conceptual model of national competitiveness, focusing on the influence of foreign subsidiaries on the competitiveness of their host countries. Essentially, we view foreign subsidiaries as potential sources of resources important to a nation in developing and maintaining its international competitiveness. We argue that there is a set of subsidiary characteristics that enables a foreign subsidiary to contribute to the national competitiveness of its host country. These characteristics include the strategic role of the subsidiary, the level of technology employed in the subsidiary's processes, the type of training provided by the parent company, and the degree to which the subsidiary is part of an interdependent network of international subunits of the firm. National policy implications are discussed.

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    Bibliographic Info

    Article provided by Elsevier in its journal Journal of International Management.

    Volume (Year): 5 (1999)
    Issue (Month): 3 ()
    Pages: 187-206

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    Handle: RePEc:eee:intman:v:5:y:1999:i:3:p:187-206

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    Related research

    Keywords: National competitiveness Multinational corporations Foreign subsidiaries Host country;

    References

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    1. Thomas L Brewer, 1993. "Government Policies, Market Imperfections, and Foreign Direct Investment," Journal of International Business Studies, Palgrave Macmillan, vol. 24(1), pages 101-120, March.
    2. Stefanie Ann Lenway & Thomas P Murtha, 1994. "The State as Strategist in International Business Research," Journal of International Business Studies, Palgrave Macmillan, vol. 25(3), pages 513-535, September.
    3. Jos� de La Torre, 1981. "Foreign Investment and Economic Development: Conflict and Negotiation," Journal of International Business Studies, Palgrave Macmillan, vol. 12(2), pages 9-32, June.
    4. Freeman, Chris, 1995. "The 'National System of Innovation' in Historical Perspective," Cambridge Journal of Economics, Oxford University Press, vol. 19(1), pages 5-24, February.
    5. Mowery, David C & Oxley, Joanne E, 1995. "Inward Technology Transfer and Competitiveness: The Role of National Innovation Systems," Cambridge Journal of Economics, Oxford University Press, vol. 19(1), pages 67-93, February.
    6. Bruce Kogut & Udo Zander, 1993. "Knowledge of the Firm and the Evolutionary Theory of the Multinational Corporation," Journal of International Business Studies, Palgrave Macmillan, vol. 24(4), pages 625-645, December.
    7. John H Dunning, 1980. "Towards an Eclectic Theory of International Production: Some Empirical Tests," Journal of International Business Studies, Palgrave Macmillan, vol. 11(1), pages 9-31, March.
    8. Julian Birkinshaw, 1996. "How Multinational Subsidiary Mandates are Gained and Lost," Journal of International Business Studies, Palgrave Macmillan, vol. 27(3), pages 467-495, September.
    9. Caves, Richard E, 1974. "Multinational Firms, Competition, and Productivity in Host-Country Markets," Economica, London School of Economics and Political Science, vol. 41(162), pages 176-93, May.
    10. Nathan Fagre & Louis T Wells, 1982. "Bargaining Power of Multinationals and Host Governments," Journal of International Business Studies, Palgrave Macmillan, vol. 13(2), pages 9-24, June.
    11. Blomstrom, Magnus, 1986. "Foreign Investment and Productive Efficiency: The Case of Mexico," Journal of Industrial Economics, Wiley Blackwell, vol. 35(1), pages 97-110, September.
    12. Kokko, Ari, 1994. "Technology, market characteristics, and spillovers," Journal of Development Economics, Elsevier, vol. 43(2), pages 279-293, April.
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    Cited by:
    1. Iammarino, Simona & Padilla-Pérez, Ramon & von Tunzelmann, Nick, 2008. "Technological Capabilities and Global-Local Interactions: The Electronics Industry in Two Mexican Regions," World Development, Elsevier, vol. 36(10), pages 1980-2003, October.
    2. Jindra, Björn & Giroud, Axèle & Scott-Kennel, Joanna, 2009. "Subsidiary roles, vertical linkages and economic development: Lessons from transition economies," Journal of World Business, Elsevier, vol. 44(2), pages 167-179, April.
    3. Padilla-Pérez, Ramón, 2008. "A regional approach to study technology transfer through foreign direct investment: The electronics industry in two Mexican regions," Research Policy, Elsevier, vol. 37(5), pages 849-860, June.

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