Subsidiary divestment of EMNEs – Does home country matter?

Luíza Neves Marques da Fonseca, Angela da Rocha and Jorge Brantes Ferreira

Journal of Business Research, 2023, vol. 168, issue C

Abstract: This research is a response to a call for studies addressing the issue of de-internationalization in the context of emerging countries. It does so by examining the divestment of foreign subsidiaries of Brazilian multinational firms. Adopting the Institutional-Based View and Dunning’s Investment Development Path, the study investigates whether institutional characteristics of the home country environment influence the divestment of emerging market multinational enterprises. The results indicate that receiving governmental financial support to establish foreign subsidiaries can lead to higher rates of divestment. Furthermore, divestment tends to be higher when an enterprise’s home country counterparts are divesting from the same host country. Conversely, having market supporting institutions in the home country diminishes the likelihood of foreign divestment.

Keywords: De-internationalization; Foreign divestment; Emerging market multinationals; Survival analysis; Home country (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jbrese:v:168:y:2023:i:c:s0148296323005623

DOI: 10.1016/j.jbusres.2023.114203

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