X hits on this document

94 views

0 shares

0 downloads

0 comments

13 / 32

13

illustrated by the Chinese MNEs (Buckley et al. 2007).

A final feature of the new MNEs is that they enjoy more freedom to implement organizational innovations to adapt to the requirements of globalization because they do not face the constraints typical of established MNEs. As major global players with long histories, many MNEs from the developed economies suffer from inertia and path dependence due to their deeply ingrained values, culture and organizational structure. Matthews (2006) shows how the new MNEs from Asia have adopted a number of innovative organizational forms that suited their needs, including networked and decentralized structures.

When analyzing the foreign investments of the new MNEs of the 1960s and 70s, scholars focused their attention on two important questions, namely, their motivations and their proprietary, firm-specific advantages, if any. The following sections deal with these two issues.

Motivations of New MNEs

Table 2 summarizes the main motivations identified in the literature. As noted above, scholars documented and readily explained the desire of some of the new MNEs to create backward linkages into sources of raw materials or forward linkages into foreign markets in order to reduce uncertainty and opportunism in the relationship between the firm and the supplier of the raw material, or between the firm and the distributor or agent in the foreign market. Research documented, especially in the cases of South Korean and Taiwanese firms their drive to internalize backward and forward linkages through the creation of trading companies, in some cases with government encouragement and financial support (Fields 1995:183-237). For example, while during the 1960s a tiny proportion of South Korea’s exports reached foreign markets through the distribution and sale channels established by South Korean firms, by the

Document info
Document views94
Page views94
Page last viewedSun Dec 04 22:19:33 UTC 2016
Pages32
Paragraphs252
Words7990

Comments