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Regional location of multinational corporation subsidiaries and economic development contribution: Evidence from the UK

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  • Dimitratos, Pavlos
  • Liouka, Ioanna
  • Young, Stephen
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    Abstract

    The regional location of multinational corporation (MNC) subsidiaries in their host country and their associated entrepreneurial output and networking activities are likely to affect their economic development contribution, measured in terms of technology and management know-how transfers; enhancement of innovativeness of other firms; and company spinoffs. This theme has considerable research and public policy value. We investigate the issue drawing from a large-scale study of 264 MNC subsidiaries based in the UK. The findings show that activities in developed regions are associated with higher economic development contribution than those in less developed regions. Moreover, entrepreneurial output and networking with partners external to the MNC system positively affect economic development contribution. Key implications of this study are that entrepreneurship critically influences economic development contribution, underlying the importance of the MNC subsidiary research stream; and that the policy practice of supply-side measures fostering entrepreneurial output and embeddedness in local networks seems to be appropriate to pursue.

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    Article provided by Elsevier in its journal Journal of World Business.

    Volume (Year): 44 (2009)
    Issue (Month): 2 (April)
    Pages: 180-191

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    Handle: RePEc:eee:worbus:v:44:y:2009:i:2:p:180-191

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    Keywords: Multinational subsidiaries Economic development UK regions International entrepreneurship;

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    Cited by:
    1. Elisa Giuliani, 2010. "Multinational Corporations, Technology Spillovers and Human Rights's Impacts on Developing Countries," LEM Papers Series 2010/06, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    2. Griffith, David A., 2011. "Insights into gaining access to export financing: Understanding export lenders' ideal exporter profile," Journal of World Business, Elsevier, vol. 46(1), pages 84-92, January.
    3. Filip De Beule, 2011. "Localization, Globalization and Networks of foreign Subsidiaries," Working Papers id:4500, eSocialSciences.
    4. Schmid, Stefan & Dzedek, Lars R. & Lehrer, Mark, 2014. "From Rocking the Boat to Wagging the Dog: A Literature Review of Subsidiary Initiative Research and Integrative Framework," Journal of International Management, Elsevier, vol. 20(2), pages 201-218.

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