Product differentiation, external economies and MNE location choices: M&As in Global Cities

Lilach Nachum and Cliff Wymbs
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Lilach Nachum: Baruch College, City University New York, New York, NY, USA
Cliff Wymbs: Baruch College, City University New York, New York, NY, USA

Journal of International Business Studies, 2005, vol. 36, issue 4, 415-434

Abstract: Recent research has addressed the heterogeneity among MNEs in terms of their tendency to agglomerate. In this paper, we extend the scope of the firm-specific attributes considered to affect this agglomeration tendency by examining product differentiation. We find significant association between product differentiation and the preferences of firms for proximity to other firms in their industry. These findings imply that the value of agglomeration varies for firms pursuing different product differentiation strategies. We propose a conceptualization of product and location differentiations as two related dimensions of MNEs’ strategy. Journal of International Business Studies (2005) 36, 415–434. doi:10.1057/palgrave.jibs.8400151

Date: 2005
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