Rationality vs ignorance: The role of MNE headquarters in subsidiaries’ innovation processes

Francesco Ciabuschi, Mats Forsgren and Oscar Martín Martín
Additional contact information
Francesco Ciabuschi: Department of Business Studies, Uppsala University, Uppsala, Sweden
Mats Forsgren: Department of Business Studies, Uppsala University, Uppsala, Sweden
Oscar Martín Martín: 1] Department of Business Studies, Uppsala University, Uppsala, Sweden[2] Department of Business Administration, Public University of Navarre, Pamplona, Spain

Journal of International Business Studies, 2011, vol. 42, issue 7, 958-970

Abstract: Innovation processes in multinational enterprises (MNE) are largely context specific, and carried out at the subsidiary level. Therefore, corporate headquarters (HQ) involvement in these processes becomes a major issue. A typical assumption in international business (IB) theory is that HQ, based on its own knowledge, makes rational choices about its own involvement. However, according to some studies, HQ involvement can be assumed to be less rational, in the sense that it reflects not HQ knowledge but the normative expectations associated with the role of HQ as top manager. The purpose of this paper is to contrast these two perspectives by exploring their implications regarding the relationship between HQ knowledge about and HQ involvement in innovation processes at the subsidiary level, and regarding the impact of this potential involvement on innovation processes performance. The analysis results in six propositions and an illustrative case. Our contribution to IB research is primarily theoretical: we bring to the scene an alternative approach – the sheer ignorance perspective – with the potential to explain the behavior of key actors in the MNE. We argue, however, that the theoretical conflict between the two perspectives should be addressed by empirical research. We conclude with suggestions for the directions such research might take.

Date: 2011
References: Add references at CitEc
Citations: View citations in EconPapers (35)

Downloads: (external link)
http://www.palgrave-journals.com/jibs/journal/v42/n7/pdf/jibs201124a.pdf Link to full text PDF (application/pdf)
http://www.palgrave-journals.com/jibs/journal/v42/n7/full/jibs201124a.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:42:y:2011:i:7:p:958-970

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 ().