The dynamics of digital technologies in the strategies of MNEs

The use of digital technologies in commercial transactions affects both the strategies of international firms and the organisation of production across borders along a GVC. This paper examines the impacts of e-commerce on the internationalisation of firms and on the global extension of manufacturing MNEs. We consider how the use of digital technologies in commercial activities and the extent of control over international markets affect decisions around exporting and investing abroad. Final market transactions are approached through business-to-customer e-commerce (B2C), and inter-firm transactions through business-to-business e-commerce (B2B). Findings confirm general positive effects from B2C transactions, while B2B e-commerce with clients or suppliers reshapes global production networks in diverse ways, depending on the direction. Evidence is built using micro-data from Spanish manufacturing, examining companies that produce physical goods and adopt ICTs. Theoretical implications suggest a dynamic and mutually reinforcing relationship between the digitalisation and internationalisation of firms, enhanced by the GVC.