Nature and determinants of productivity growth of foreign subsidiaries in Central and East European countries

Boris Majcen, Slavo Radosevic and Matija Rojec

Economic Systems, 2009, vol. 33, issue 2, 168-184

Abstract: The paper examines the determinants of productivity growth in foreign manufacturing subsidiaries in five Central and East European (CEE) countries by analysing patterns of control, nature of firms' capabilities and firms' market orientations. Building on the so-called 'subsidiary development' perspective, we show that productivity growth is determined jointly by corporate governance, production capability and market orientation variables. Within a dominantly production-oriented mandate, CEE subsidiaries have a relatively high level of autonomy in the control of their business functions. Majority foreign equity shareholding has a significant and positive impact on subsidiaries' productivity growth. Our results show strong regional characteristics.

Keywords: Foreign; subsidiaries; Productivity; Central; and; Eastern; Europe (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (10)

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Related works:
Working Paper: Nature and determinants of productivity growth of foreign subsidiaries in Central and East European countries (2006)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecosys:v:33:y:2009:i:2:p:168-184

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