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A Comparative Study of Multinational Subsidiaries and Local Companies in Emerging Economies: A Manufacturing Practice Approach

Author

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  • Levente Szász

    (Faculty of Economics and Business Administration, Babeş-Bolyai University, Cluj-Napoca, Romania)

  • Béla Gergely Rácz

    (Faculty of Economics and Business Administration, Babeş-Bolyai University, Cluj-Napoca, Romania)

  • Anca Borza

    (Faculty of Economics and Business Administration, Babeş-Bolyai University, Cluj-Napoca, Romania)

  • Botond Benedek

    (Faculty of Economics and Business Administration, Babeş-Bolyai University, Cluj-Napoca, Romania)

Abstract

This paper investigates whether multinational companies possess superior manufacturing knowledge relative to domestic companies operating in emerging market countries. Manufacturing knowledge is operationalized as knowledge in use through the implementation and performance impact of manufacturing practices. Using survey data of 216 manufacturing plants located in five emerging countries, we apply analysis of variance (ANOVA) and structural equation modelling (SEM) to identify the potential knowledge surplus of multinational subsidiaries over local companies. Results of our analysis show that, generally, multinational subsidiaries invest significantly more effort in implementing manufacturing practices. Nevertheless, their knowledge superiority concerning the effective use of these practices is only materialized in terms of practices related to human resource development and advanced manufacturing technologies.

Suggested Citation

  • Levente Szász & Béla Gergely Rácz & Anca Borza & Botond Benedek, 2019. "A Comparative Study of Multinational Subsidiaries and Local Companies in Emerging Economies: A Manufacturing Practice Approach," Acta Oeconomica, Akadémiai Kiadó, Hungary, vol. 69(supplemen), pages 107-129, December.
    • Handle: RePEc:aka:aoecon:v:69:y:2019:i:supplement2:p:107-129
    Note: The research was funded by UEFISCDI Romania (Executive Agency for Higher Education, Research, Development and Innovation Funding), project No. PN-III-P1-1.1-TE-2016-0502.
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    References listed on IDEAS

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    More about this item

    Keywords

    multinational companies; best practice; knowledge management; knowledge transfer; emerging markets;
    All these keywords.

    JEL classification:

    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • M11 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Production Management
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology

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