Transnationality and Financial Performance in the Era of the Global Factory

Peter J. Buckley and Xiaowen Tian ()
Additional contact information
Peter J. Buckley: University of Leeds
Xiaowen Tian: Murdoch University

Management International Review, 2017, vol. 57, issue 4, No 1, 528 pages

Abstract: Abstract Drawing on the core notions of knowledge augmentation and rational choice in internalization theory, the paper develops a theoretical framework to examine the relationship between transnationality and financial performance in the era of the global factory, and tests hypotheses against recent experience of leading transnational enterprises. The paper rejects a direct relationship between transnationality and financial performance, and supports a mediation model in which knowledge-based assets mediate the relationship between transnationality and financial performance conditional on R&D intensity. In making decisions on the transnationality of a firm, managers should not focus on whether it helps the firm achieve direct financial benefits because these are quickly offset by the costs in a competitive environment. Instead, they should focus on whether it helps the firm enhance knowledge-based assets and, through it, financial gains that can be long-lasting, and whether it is supported by R&D to augment such assets.

Keywords: Internalization theory; Transnationality; Performance; Global factory (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

Downloads: (external link)
http://link.springer.com/10.1007/s11575-016-0306-7 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

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: https://EconPapers.repec.org/RePEc:spr:manint:v:57:y:2017:i:4:d:10.1007_s11575-016-0306-7

Ordering information: This journal article can be ordered from
http://www.springer.com/journal/11575

DOI: 10.1007/s11575-016-0306-7

Access Statistics for this article

Management International Review is currently edited by Michael-Jörg Oesterle and Joachim Wolf

More articles in Management International Review from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().