The roles of emerging multinational companies’ technology-driven FDIs in their learning processes for innovation

Ju Liu

International Journal of Emerging Markets, 2018, vol. 14, issue 1, 91-114

Abstract: Purpose - The purpose of this paper is to contextually theorise the different patterns of emerging multinational companies’ (EMNCs’) learning processes for innovation and the different influences of their technology-driven FDIs (TFDIs) on the processes. Design/methodology/approach - A comparative case study method and process tracing technique are employed to investigate how and why firms’ learning processes for innovation took place, how and why the TFDIs emerged and influenced the firms’ learning processes in different ways. Findings - The paper identifies two different patterns of learning process for innovation (Glider model vs Helicopter model) and two different roles of the case firms’ TFDIs (accelerator vs starter) in the different contexts of their learning processes. It is found that the capability building of the domestic wind energy industry has an important influence on the case of EMNCs’ learning processes and thus on the roles of their TFDIs. Research limitations/implications - The limitation of the paper lies in its small number of cases in a specific industry of a specific country. The two contextually identified learning models and roles of TFDIs may not be applied to other industries or other countries. Future research should investigate more cases in broader sectoral and geographic scope to test the models and also to identify new models. Practical implications - For EMNCs, who wants to use the Helicopter model to rapidly gain production and innovation capability, cross-cultural management and integration management are crucial to practitioners. For emerging countries with ambitions to explore the global knowledge and technology pool, besides of the EMNC’s capability building, the capability building in the domestic industries should not be overlooked by policy makers. Originality/value - The paper develops a dynamic and contextual analytical framework which helps to answer the important questions about how and under what context a TFDI emerges and influences firm’s learning process for innovation. It theorises the EMNCs’ learning process and TFDIs in the context of the development of the domestic industry. It strengthens the explanatory power of the learning-based view and adds new knowledge to the current FSA/CSA discourse in the international business literature.

Keywords: China; Europe; Emerging market multinationals; Foreign direct investment (FDI); Technological innovation; Wind energy (search for similar items in EconPapers)
Date: 2018
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Persistent link: https://EconPapers.repec.org/RePEc:eme:ijoemp:ijoem-07-2017-0232

DOI: 10.1108/IJoEM-07-2017-0232

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