Abstract: We examine the extent to which state ownership interacts with host country political risk, behavioral inertia and mimetic behavior, and how these relationships affect Chinese outward foreign direct investment (OFDI) location decisions. We hypothesize that government ownership makes Chinese multinational enterprises (MNEs) less risk averse and less dependent on their previous entry experience in a particular host country and on the experience of other Chinese firms in the same host environment. Using a data set of 489 China’s OFDI location decisions between 2005 and 2013, we find empirical evidence that state ownership moderates the effect of political risk, inertial and mimetic behavior on the location choice of Chinese MNEs.

Abstract: Location advantages have been a key concern of global strategy for three decades and an important issue in economics for more than a century. This area of research increasingly has focused on the location of firms in agglomerations or clusters, particularly in emerging economies. Substantial institutional change may be necessary to create conditions that make a location attractive to domestic and foreign enterprises and promote growth of industrial clusters. Multinational enterprises (MNEs) play an important part in this process, particularly in emerging economies. MNEs serve as institutional entrepreneurs, interacting with local institutions to reshape the business environment. We extend recent work on co-evolution by Cantwell, Dunning and Lundan (2010) to a more general theory of institutional change in the development of industrial clusters.

Abstract: Using multinational retail chains, we investigate how organizations manage bi-directional knowledge flows to achieve standardization of the organizational knowledge that they had accumulated through years to achieve economies of accurate replication without imitation and, at the same time, benefit from tapping into new knowledge bases by adapting while they internationalize. (Barlett & Ghoshal, 1989; Grifith & Hi, 2000; Kaufman & Eroglu, 1999; Szulanski & Jensen, 2006). Our novel study reviews multinational retail chains' decisions after they have entered a foreign country and tracks their alteration of initial ownership and format decisions over time. Our preliminary results indicate strong positive results for increasing post ownership percentages to support standardization, altering format changes in response to better adaptation and also the joint effects of both of these on performance at the host-country.

Abstract: Firms pursue international diversification to create value. We examine how the location of diversification influences the nature of firm value. Based on real options theory, we argue that for U.S. firms, international diversification into emerging economies increases growth option value. In contrast, expansion into advanced economies will be associated with assets-in-place value. Using a sample of 672 firms from the S&P 1,500 over a period of 9 years, we find support for these arguments. We also examine the impact of the focus of the firm’s diversification strategies, finding that that greater within-economy diversity reduces the level of growth option value or assets in place value created. These results suggest that the location of international diversification and within-economy diversity both determine the nature of value creation.

Abstract: The literature on foreign market entry by multinational firms has rarely considered that entry decisions depend on the existing portfolio of overseas affiliates. We argue that multinational firms take into account the contribution that each entry into a new location makes towards enhancing the operational flexibility of their manufacturing affiliate portfolios. We establish boundary conditions to the influence of such switching options on entry. Substantial differences in labor cost levels across locations reduce effective switching potential, while moderate differences increase it. Product diversification in manufacturing portfolios hampers switching across plants, while growth potential in the host country market can compensate for the carrying costs of maintaining switching options. Hypotheses are tested on longitudinal data (1989-2006) on the population of publicly listed Japanese manufacturing firms.

Abstract: Political uncertainty impacts firms’ expansion into foreign markets. Still, political risk differs from terrorist risk, which is subnational in nature. We rely on market-access and experiential learning theories to elaborate competing hypotheses on the impact of terrorism on multilocational firms’ expansion into foreign markets. We use multinomial panel data probit techniques to examine how terrorism affects the location and speed of expansion of DIY outlets across South America over a 21-year period. We find that terrorism affects the dynamics of within country firm expansion. Our results indicate that, in counties where terrorist threats are smaller, firms prioritize geographical expansion by entering new local markets, while higher terrorist threats lead firms to open outlets in markets they had already entered. We also find that terrorism explains the velocity of firm expansion, as first entry is quicker than second entry