Knowledge of the Firm and the Evolutionary Theory of the Multinational Corporation

Bruce Kogut and Udo Zander
Additional contact information
Bruce Kogut: University of Pennsylvania
Udo Zander: University of Pennsylvania

Journal of International Business Studies, 1993, vol. 24, issue 4, 625-645

Abstract: Firms are social communities that specialize in the creation and internal transfer of knowledge. The multinational corporation arises not out of the failure of markets for the buying and selling of knowledge, but out of its superior efficiency as an organizational vehicle by which to transfer this knowledge across borders. We test the claim that firms specialize in the internal transfer of tacit knowledge by empirically examining the decision to transfer the capability to manufacture new products to wholly owned subsidiaries or to other parties. The empirical results show that the less codifiable and the harder to teach is the technology, the more likely the transfer will be to wholly owned operations. This result implies that the choice of transfer mode is determined by the efficiency of the multinational corporation in transferring knowledge relative to other firms, not relative to an abstract market transaction. The notion of the firm as specializing in the transfer and recombination of knowledge is the foundation to an evolutionary theory of the multinational corporation.© 1993 JIBS. Journal of International Business Studies (1993) 24, 625–645

Date: 1993
References: Add references at CitEc
Citations: View citations in EconPapers (872)

Downloads: (external link)
http://www.palgrave-journals.com/jibs/journal/v24/n4/pdf/8490248a.pdf Link to full text PDF (application/pdf)
http://www.palgrave-journals.com/jibs/journal/v24/n4/full/8490248a.html Link to full text HTML (text/html)
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:pal:jintbs:v:24:y:1993:i:4:p:625-645

Ordering information: This journal article can be ordered from
http://www.springer. ... nt/journal/41267/PS2

Access Statistics for this article

Journal of International Business Studies is currently edited by John Cantwell

More articles in Journal of International Business Studies from Palgrave Macmillan, Academy of International Business
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().