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A microeconometric analysis of the springboard subsidiary: The case of Spanish firms

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  • Caicedo Marulanda, Carolina
  • Pla-Barber, José
  • León Darder, Fidel
  • Mora, Jhon James

Abstract

This paper provides a microeconometric analysis of the distinctive characteristics of springboard subsidiaries that have a positive impact on the subsidiaries' performance. Based on panel data estimations for subsidiaries of European multinational companies with a presence in Spain, the authors found that if the subsidiary is located in the springboard country, then the performance improvement (increase in profit margin) of the subsidiary is about 49 percentage points. When the Spanish subsidiary is considered a springboard subsidiary, its performance is 7.7 percentage points higher than the performance of other subsidiaries that are not springboard subsidiaries. If the subsidiary has a technological relationship with another subsidiary, its performance is 6.7 percentage points higher than the performance of other subsidiaries that do not have a technological relationship. Finally, when the firm has low autonomy, the performance of the subsidiary is 6.2 percentage points lower than that of firms that are independent or have a high level of autonomy.

Suggested Citation

  • Caicedo Marulanda, Carolina & Pla-Barber, José & León Darder, Fidel & Mora, Jhon James, 2015. "A microeconometric analysis of the springboard subsidiary: The case of Spanish firms," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy (IfW), vol. 9, pages 1-34.
  • Handle: RePEc:zbw:ifweej:201523
    DOI: 10.5018/economics-ejournal.ja.2015-23
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    References listed on IDEAS

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    1. Arjen H L Slangen & Jean-François Hennart, 2008. "Do multinationals really prefer to enter culturally distant countries through greenfields rather than through acquisitions? The role of parent experience and subsidiary autonomy," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 39(3), pages 472-490, April.
    2. William K Brandt & James M Hulbert, 1976. "Patterns of Communications in the Multinational Corporation: An Empirical Study," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 7(1), pages 57-64, March.
    3. Julian M Birkinshaw & Allen J Morrison, 1995. "Configurations of Strategy and Structure in Subsidiaries of Multinational Structure," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 26(4), pages 729-753, December.
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    More about this item

    Keywords

    TFP; Microeconometric analysis; springboard country; springboard subsidiary; subsidiary - specific advantage; firm performance; panel data;
    All these keywords.

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • J2 - Labor and Demographic Economics - - Demand and Supply of Labor

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