Determinants of foreign subsidiary staffing by service firms

Naoki Ando and Nobuaki Endo

Management Research Review, 2013, vol. 36, issue 6, 548-561

Abstract: Purpose - The purpose of this paper is to examine how service firms determine foreign subsidiary staffing, emphasizing the joint effect of an attribute specific to the service sector and the institutional environment of the host countries. Design/methodology/approach - This study develops hypotheses regarding the joint effect of human capital intensity and institutional distance on the ratio of parent country nationals to foreign subsidiary employees. A Tobit regression is conducted to test the hypotheses, using a sample that consists of 1,067 foreign subsidiaries of Japanese service firms. Findings - This study finds that the human capital intensity of a service firm has a positive impact on the ratio of parent country nationals to foreign subsidiary employees. The study also finds that the institutional distance between the host country and the home country is negatively associated with the ratio of parent country nationals. In addition, this study finds that the positive impact of human capital intensity on the ratio of parent country nationals becomes weaker as the institutional distance becomes greater. Originality/value - This study explores the factors that affect the decisions regarding foreign subsidiary staffing in the service sector. It advances the understanding of the foreign subsidiary staffing of service firms by examining the joint effect of an attribute specific to the service sector and the institutional environment of the host countries. This study shows evidence that the effect of an attribute specific to the service sector is more complex than a linear relationship.

Keywords: Multinational companies; Subsidiaries; Human resource management; Staff organization; Foreign subsidiary staffing; Expatriates; Service firms; Human capital intensity; Institutions (search for similar items in EconPapers)
Date: 2013
References: Add references at CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (text/html)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (application/pdf)
Access to full text is restricted to subscribers

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:eme:mrrpps:v:36:y:2013:i:6:p:548-561

DOI: 10.1108/01409171311325723

Access Statistics for this article

Management Research Review is currently edited by Dr Jay Janney and Prof Lerong He

More articles in Management Research Review from Emerald Group Publishing Limited
Bibliographic data for series maintained by Emerald Support ().