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International Experience and the Performance of Scandinavian Firms in China

Author

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  • Carlsson, Johan

    (Stockholm School of Economics)

  • Nordegren, Axel

    (Stockholm School of Economics)

  • Sjöholm, Fredrik

    (European Institute of Japanese Studies)

Abstract

Western firms locating in China face a business environment that differs from their home country environment. The differences increase uncertainties and are negative for economic performance. However, firms may differ in their ability to overcome the difficulties, depending on their previous experience. In particular, firms with experience from regions similar to China might do comparably well. We conduct a survey of Scandinavian firms with subsidiaries in China to examine their economic performance. Our results show that subsidiaries in China perform better if the firms have subsidiaries in Hong Kong, Taiwan, or Singapore. In addition, the length of subsidiaries’ operation in China, and the experience from foreign countries outside of Greater China, are also positively affecting the subsidiaries’ economic performance.

Suggested Citation

  • Carlsson, Johan & Nordegren, Axel & Sjöholm, Fredrik, 2004. "International Experience and the Performance of Scandinavian Firms in China," EIJS Working Paper Series 188, Stockholm School of Economics, The European Institute of Japanese Studies.
    • Handle: RePEc:hhs:eijswp:0188
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    References listed on IDEAS

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    13. Dikova, Desislava, 2009. "Performance of foreign subsidiaries: Does psychic distance matter?," International Business Review, Elsevier, vol. 18(1), pages 38-49, February.
    14. Trąpczyński, Piotr & Banalieva, Elitsa R., 2016. "Institutional difference, organizational experience, and foreign affiliate performance: Evidence from Polish firms," Journal of World Business, Elsevier, vol. 51(5), pages 826-842.
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    16. Chun-Sheng Joseph Li & Tser-Yieth Chen & Phil Yihsing Yang, 2016. "Local Embeddedness, Market Focus, and Productivity: Evidence of Taiwanese Manufacturing MNE Subsidiaries in China," Growth and Change, Wiley Blackwell, vol. 47(4), pages 596-611, December.
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    More about this item

    Keywords

    FDI; Firms; Experience; China; Scandinavia;
    All these keywords.

    JEL classification:

    • F20 - International Economics - - International Factor Movements and International Business - - - General
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • M20 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - General

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