A stranger in a strange land: Micro political risk and the multinational firm

Ilan Alon and Theodore T. Herbert

Business Horizons, 2009, vol. 52, issue 2, pages 127-137

Abstract: When a firm chooses to enter or continue business in a foreign market, it becomes exposed to associated political risks which should be assessed and managed. Help is available for becoming aware of the level of macro political risk; that is, the political risk across industries or all businesses in entire countries or geographic regions. Yet, surprisingly little guidance exists by which to identify and assess firm-specific political risks, termed micro political risk. Herein, we offer some new perspectives on the nature of micro political risk within a host country, illustrating how it stems from economic, societal, and governmental forces. We have compiled a number of firm-specific variables which can affect the firm's micro political risk profile, and advance an innovative methodology by which executives can address these variables and develop an assessment of their firm's micro political risk. Examples of micro political risk situations are provided, along with discussion of implementing the proposed methodology.

Keywords: Micro; political; risk; Risk; assessment; Environmental; analysis; Multinational; corporation (search for similar items in EconPapers)
Date: 2009

Downloads: (external link)
http://www.sciencedirect.com/science/article/B6W45 ... 9860d7be2f922aeb974c
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:eee:bushor:v:52:y:2009:i:2:p:127-137

Access Statistics for this article

Business Horizons is edited by C. M. Dalton

More articles in Business Horizons from Elsevier
Series data maintained by Heidi Boesdal ().