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Dynamic capabilities, entrepreneurial rent-seeking and the investment development path: The case of Samsung

  • Lee, Jaeho
  • Slater, Jim
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    As noted by Narula and Dunning [Narula, R., Dunning. J.H., 2000. Industrial Development, Globalization and Multinational Enterprise: New Realities for Developing Countries. Oxford Development Studies, 28, 141-167.], it has been observed that some of the more advanced developing countries, those rapidly 'catching-up', outpaced the postulated Investment Development Path (IDP), in which the strategic asset-seeking type of outward foreign direct investment is supposed to occur in later stages, i.e., when countries reach the higher "developed" levels of economic progress. Firms who led the outpacing in those countries did so through their entrepreneurial commitment to upgrade technological capabilities to maintain and augment their O-advantages rather than because of the overall economic development of their home country. Samsung Electronics' recent success in the semiconductor industry allows us to identify and analyse the factors whereby it not only utilised status-quo resources but also developed dynamic capabilities as it rose to the top. Aggressive and risk-taking investment behaviour in search of entrepreneurial rent and the effective policy of managing technology development contributed to the extraordinary achievement of Samsung Electronics. The company's remarkable transformation over the last decade or so can shed light on how a firm's dynamic capabilities, the ability to improve its O-advantages by reconfiguration, transformation and learning, contribute to its home country's idiosyncratic development path.

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

    Volume (Year): 13 (2007)
    Issue (Month): 3 (September)
    Pages: 241-257

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    Handle: RePEc:eee:intman:v:13:y:2007:i:3:p:241-257
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