Economics at your fingertips  

An evolutionary approach to understanding international business activity: The co-evolution of MNEs and the institutional environment

John Cantwell (), John H Dunning and Sarianna M Lundan
Additional contact information
John H Dunning: Department of Economics, University of Reading, Reading, UK
Sarianna M Lundan: Department of Organization and Strategy, School of Business and Economics, Maastricht University, Maastricht, The Netherlands

Journal of International Business Studies, 2010, vol. 41, issue 4, 567-586

Abstract: This paper examines the co-evolution of MNE activities and institutions external and internal to the firm. We develop a theoretical framework for this analysis that draws on the more recent writings of Douglass North on institutions as a response to complex forms of uncertainty associated with the rise in global economic interconnectedness, and of Richard Nelson on the co-evolution of technology and institutions. We link historical changes in the character of MNE activities to changes in the institutional environment, and highlight the scope for firm-level creativity and institutional entrepreneurship that may lead to co-evolution with the environment. We argue that the main drivers for institutional entrepreneurship are now found in the increasing autonomy of MNE subsidiaries. Thus MNE agency derives from more decentralized forms of experimentation in international corporate networks, which competence-creating nodes of new initiatives can co-evolve with local institutions. Unlike most other streams of related literature, our approach connects patterns of institutional change in wider business systems with more micro processes of variety generation and experimentation within and across individual firms. This form of co-evolutionary analysis is increasingly important to understanding the interrelationships between MNE activities and public policy.

Date: 2010
References: Add references at CitEc
Citations: View citations in EconPapers (103) Track citations by RSS feed

Downloads: (external link) Link to full text PDF (application/pdf) 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:

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 ().

Page updated 2019-07-22
Handle: RePEc:pal:jintbs:v:41:y:2010:i:4:p:567-586