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Country location choices of service multinationals: An empirical study of the international hotel sector


  • Kundu, Sumit K.
  • Contractor, Farok J.


This article examines international country location choices for equity investment undertaken by global hotel chains. Why do certain host countries attract more hotel investment than others? A second underlying issue that we tackle in this article is whether the traditional foreign direct investment determinants used in past studies on manufacturing also apply to services--or whether service sector-specific determinants are better explanatory variables for understanding the distribution of service foreign direct investment across countries.

Suggested Citation

  • Kundu, Sumit K. & Contractor, Farok J., 1999. "Country location choices of service multinationals: An empirical study of the international hotel sector," Journal of International Management, Elsevier, vol. 5(4), pages 299-317.
  • Handle: RePEc:eee:intman:v:5:y:1999:i:4:p:299-317

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    References listed on IDEAS

    1. Jamuna Agarwal, 1980. "Determinants of foreign direct investment: A survey," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 116(4), pages 739-773, December.
    2. Ralph M Gaedeke, 1973. "Selected U.S. Multinational Service Firms in Perspective," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 4(1), pages 61-66, March.
    3. Goldberg, Lawrence G. & Johnson, Denise, 1990. "The determinants of US banking activity abroad," Journal of International Money and Finance, Elsevier, vol. 9(2), pages 123-137, June.
    4. Horst, Thomas, 1972. "Firm and Industry Determinants of the Decision to Invest Abroad: An Empirical Study," The Review of Economics and Statistics, MIT Press, vol. 54(3), pages 258-266, August.
    5. Fagerberg, Jan, 1988. "International Competitiveness," Economic Journal, Royal Economic Society, vol. 98(391), pages 355-374, June.
    6. Peter Wilson, 1994. "Tourism Earnings Instability in Singapore, 1972-88," Journal of Economic Studies, Emerald Group Publishing, vol. 21(1), pages 41-51, January.
    7. Culem, Claudy G., 1988. "The locational determinants of direct investments among industrialized countries," European Economic Review, Elsevier, vol. 32(4), pages 885-904, April.
    8. J H Dunning & G Norman, 1987. "The location choice of offices of international companies," Environment and Planning A, Pion Ltd, London, vol. 19(5), pages 613-631, May.
    9. Goldberg, Lawrence G. & Saunders, Anthony, 1981. "The determinants of foreign banking activity in the United States," Journal of Banking & Finance, Elsevier, vol. 5(1), pages 17-32, March.
    10. Fagerberg, Jan, 1988. "International Competitiveness: Errata," Economic Journal, Royal Economic Society, vol. 98(393), pages 1203-1203, December.
    11. Esfahani, Hadi Salehi, 1991. "Exports, imports, and economic growth in semi-industrialized countries," Journal of Development Economics, Elsevier, vol. 35(1), pages 93-116, January.
    12. Grubaugh, Stephen G, 1987. "Determinants of Direct Foreign Investment," The Review of Economics and Statistics, MIT Press, vol. 69(1), pages 149-152, February.
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    Cited by:

    1. Saroja Selvanathan & E.A. Selvanathan & Brinda Viswanathan, 2009. "Causality between Foreign Direct Investment and Tourism : Empirical Evidence from India," Finance Working Papers 22944, East Asian Bureau of Economic Research.
    2. repec:eee:touman:v:57:y:2016:i:c:p:245-255 is not listed on IDEAS
    3. Oh, Chang Hoon & Sohl, Timo & Rugman, Alan M., 2015. "Regional and product diversification and the performance of retail multinationals," Journal of International Management, Elsevier, vol. 21(3), pages 220-234.
    4. Kundu, Sumit K. & Lahiri, Somnath, 2015. "Turning the Spotlight on Service Multinationals: New Theoretical Insights and Empirical Evidence," Journal of International Management, Elsevier, vol. 21(3), pages 215-219.
    5. Adina Smaranda COSMA & Cristina FLESERIU & Marius BOTA & Alexandru NEDELEA, 2015. "Aspects Of Romanian Marketing Environment For International Hotel Chains," EcoForum, "Stefan cel Mare" University of Suceava, Romania, Faculty of Economics and Public Administration - Economy, Business Administration and Tourism Department., vol. 4(1), pages 1-5, January.
    6. Oh, Chang Hoon & Sohl, Timo & Rugman, Alan M., 2015. "Regional and product diversification and the performance of retail multinationals," Journal of International Management, Elsevier, vol. 21(3), pages 220-234.
    7. Serafini, Giovanni O. & Szamosi, Leslie T., 2015. "Five star hotels of a Multinational Enterprise in countries of the transitional periphery: A case study in human resources management," International Business Review, Elsevier, vol. 24(6), pages 972-983.
    8. Kirca, Ahmet H. & Fernandez, Whitney Douglas & Kundu, Sumit K., 2016. "An empirical analysis and extension of internalization theory in emerging markets: The role of firm-specific assets and asset dispersion in the multinationality-performance relationship," Journal of World Business, Elsevier, vol. 51(4), pages 628-640.
    9. repec:eee:touman:v:59:y:2017:i:c:p:1-6 is not listed on IDEAS
    10. Moore, Winston & CRAIGWELL, ROLAND, 2008. "Foreign direct investment and tourism in SIDS: evidence from panel causality tests," MPRA Paper 33438, University Library of Munich, Germany.
    11. repec:eee:touman:v:55:y:2016:i:c:p:225-237 is not listed on IDEAS
    12. repec:eee:intman:v:23:y:2017:i:3:p:292-305 is not listed on IDEAS
    13. Santos, Maria & Brochado, Ana & Esperança, José, 2016. "Foreign direct investment patterns of global hotel chains," Journal of Business Research, Elsevier, vol. 69(11), pages 5235-5240.
    14. Chang, Cheng-Chang & Chen, Ju-Long, 2012. "A foreign expansion model with multi-site locations in service industries," International Journal of Production Economics, Elsevier, vol. 136(1), pages 102-109.


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