From multi-domestic hierarchy to network hierarchy

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Chapter 4 in The Development of International Business, 2017, pp 36-45 from Edward Elgar Publishing

Abstract: Traces what the practical narrative will interpret as the first of two crucial organisational transitions in the structural configuration of the MNE. From a multi-domestic hierarchy (MH) comprising a portfolio of semi-autonomous MS subsidiaries, each competing for the domestic market of its host economy, to a network hierarchy (NH) comprising an integrated and coordinated network of specialised (export-oriented) supply facilities. The exposition will emphasise how the MS subsidiaries could survive, despite their endemic inefficiency (access to strong OAs, protection against more competitive imports) until the move towards more open economies and freer trade exposed these inefficiencies. Shows how the ES NH subsidiaries alleviated the innate inefficiencies of MS and thereby generated higher levels of efficiency and welfare.

Keywords: Business and Management; Economics and Finance (search for similar items in EconPapers)
Date: 2017
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