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Effects of firm resources on growth in multinationality

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  • Chiung-Hui Tseng

    (Institute of International Business, National Cheng Kung University, Tainan, Taiwan, R.O.C.)

  • Patriya Tansuhaj

    (International Business Institute, Washington State University, Pullman, Washington, USA)

  • William Hallagan

    (School of Economic Sciences, Washington State University, Pullman, Washington, USA)

  • James McCullough

    (School of Business and Leadership, University of Puget Sound, Tacoma, Washington, USA)

Abstract

Multinationality refers to the extent to which firms' business activities span across national borders. Moving beyond prior emphasis on the consequences of multinational expansion, this study sheds light on the antecedents by analyzing how firm resources influence changes in multinationality. Building on the resource-based view of the firm, we propose a framework that consists of resource determinants in two categories: knowledge-based and property-based resources. Empirical results obtained from a sample of publicly held US manufacturing companies show that knowledge-based resources generate faster and longer-lasting influences on international growth than property-based resources. Specifically, resources related to technological and marketing knowledge, and property-based resources related to organizational slack and internally generated profits, are found to be significant driving forces behind growth in multinationality. This study not only advances our understanding of the antecedents of multinational expansion, but also provides implications and avenues for future research. Journal of International Business Studies (2007) 38, 961–974. doi:10.1057/palgrave.jibs.8400305

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Bibliographic Info

Article provided by Palgrave Macmillan in its journal Journal of International Business Studies.

Volume (Year): 38 (2007)
Issue (Month): 6 (November)
Pages: 961-974

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Handle: RePEc:pal:jintbs:v:38:y:2007:i:6:p:961-974

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Cited by:
  1. Lin, Wen-Ting & Cheng, Kuei-Yang & Liu, Yunshi, 2009. "Organizational slack and firm's internationalization: A longitudinal study of high-technology firms," Journal of World Business, Elsevier, Elsevier, vol. 44(4), pages 397-406, October.
  2. Cesaroni, Fabrizio & Giarratana, Marco S. & Martínez-Ros, Ester, 2012. "Technological capabilities and cost efficiency as antecedents of foreign market entry," MERIT Working Papers 049, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
  3. Tan, Danchi & Meyer, Klaus E., 2010. "Business groups' outward FDI: A managerial resources perspective," Journal of International Management, Elsevier, Elsevier, vol. 16(2), pages 154-164, June.
  4. Lin, Wen-Ting & Liu, Yunshi, 2012. "Successor characteristics, organisational slack, and change in the degree of firm internationalisation," International Business Review, Elsevier, Elsevier, vol. 21(1), pages 89-101.
  5. Wang, Chengqi & Hong, Junjie & Kafouros, Mario & Boateng, Agyenim, 2012. "What drives outward FDI of Chinese firms? Testing the explanatory power of three theoretical frameworks," International Business Review, Elsevier, Elsevier, vol. 21(3), pages 425-438.
  6. Kyläheiko, Kalevi & Jantunen, Ari & Puumalainen, Kaisu & Saarenketo, Sami & Tuppura, Anni, 2011. "Innovation and internationalization as growth strategies: The role of technological capabilities and appropriability," International Business Review, Elsevier, Elsevier, vol. 20(5), pages 508-520, October.
  7. Lin, Wen-Ting & Liu, Yunshi & Cheng, Kuei-Yang, 2011. "The internationalization and performance of a firm: Moderating effect of a firm's behavior," Journal of International Management, Elsevier, Elsevier, vol. 17(1), pages 83-95, March.
  8. Ciprian Stan & Mike Peng & Garry Bruton, 2014. "Slack and the performance of state-owned enterprises," Asia Pacific Journal of Management, Springer, Springer, vol. 31(2), pages 473-495, June.
  9. Lu, Jiangyong & Liu, Xiaohui & Filatotchev, Igor & Wright, Mike, 2014. "The impact of domestic diversification and top management teams on the international diversification of Chinese firms," International Business Review, Elsevier, Elsevier, vol. 23(2), pages 455-467.

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