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Distance-related Barriers and the Internationalisation of Finnish MNEs

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  • Lundan, Sarianna M.

Abstract

In an integrated global economy, multinational enterprises (MNEs) have more opportunities than ever to reap the benefits of broader markets and more possibilities for an extensive division of labour between different locations. In spite of this, the evidence on the spread of the activities of MNEs seems to indicate a strong regional tendency, at least for the largest MNEs. This paper examines the theoretical arguments for the existence of such boundaries in an integrated global economy, and then examines their empirical importance using recent evidence on the internationalisation patterns of Finnish MNEs. We find that while some of the largest MNEs do indeed appear to be quite regional, some of the smaller internationalising firms are notably more global in terms of the spread of their activities.

Suggested Citation

  • Lundan, Sarianna M., 2009. "Distance-related Barriers and the Internationalisation of Finnish MNEs," Discussion Papers 1193, The Research Institute of the Finnish Economy.
  • Handle: RePEc:rif:dpaper:1193
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    More about this item

    Keywords

    multinational enterprises; internationalisation; entropy; cultural distance; institutional distance;

    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • M16 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - International Business Administration

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