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1980s roughly 50 percent of them were fully internalized, that is, handled by the exporters themselves (Cho 1987). As would be expected, the new MNEs felt the pressures of uncertainty and asset specificity more strongly if they had developed intangible assets. For instance, using evidence on a representative cross-sectional sample of 837 Spanish exporting firms as of 1992, Campa and Guillén (1999) found that those with greater expenditures on R&D were more likely to internalize export operations. A recent survey of the empirical evidence concluded that many of the new MNEs, especially in the extractive and manufacturing sectors, became multinationals when they internalized backward or forward linkages (UNCTAD 2006).

Scholars also documented that developing-country MNEs wished to expand abroad in order to overcome limitations imposed by the home-country government in the domestic market. In many developing and newly industrialized countries, limitations such as licensing systems, quota allocations, and export restrictions deprived firms from having enough growth opportunities at their disposal; hence the desire to expand abroad (Lall 1983; Wells 1983). In part related to the previous motive, firms felt the need to spread risks by locating assets in different countries (Lecraw 1977). This motivation was driven by the macroeconomic and political volatility characteristic of so many developing and newly industrialized countries. Home country tended to be characterized by macroeconomic and political volatility. A variation on this effect has to do with the case of family-owned MNEs from developing countries under the threat of government scrutiny or confiscation (Wells 1983).

The early literature on the new MNEs also identified buyer-supplier relationships as motives for a supplier establishing production facilities in a foreign country in which the buyer already had a presence (Wells 1983; UNCTAD 2006). In some cases, both the buyer and the supplier are home-country firms that followed each other abroad, while in others the buyer

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