Determining Factors of Subsidiary Development

Torben Pedersen

Chapter 9 in Multinationals, Clusters and Innovation, 2006, pp 145-159 from Palgrave Macmillan

Abstract: Abstract The literature on subsidiary development has greatly expanded over the last 20 years, evaluating the dynamics behind the evolution of subsidiary roles. The literature emerged out of a critique of the traditional ‘center-periphery’ view where the firm-specific advantages are developed and controlled by the parent company, while the foreign subsidiaries are the long-arm of the parent company in exploiting the firm-specific advantages in the local market. The observation that some subsidiaries have a strategic role in the multinational corporation (MNC) that reaches beyond their local undertakings (e.g. Étemad and Dulude, 1986; Bartlett and Ghoshal, 1989; Gupta and Govindarajan, 1994) was the starting point of research on different subsidiary roles and the evolution of subsidiary roles.

Keywords: Foreign Direct Investment; Parent Company; International Business Study; Location Advantage; Nomological Validity (search for similar items in EconPapers)
Date: 2006
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Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-0-230-62494-8_9

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DOI: 10.1057/9780230624948_9

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