Do Japanese MNCs use expatriates to contain risk in Asian host countries?

Jean-Pascal Bassino (), Marion Dovis () and Pierre van der Eng

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Abstract: We investigate the impact of host-country risk on the expatriation strategies of multinational firms, using data on Japanese subsidiary firms in manufacturing industries in 13 host countries in Asia. We find that country risk is negatively correlated with the degree of expatriation and that, rather than host-country risk, firm-specific factors (particularly capital intensity, ownership share of parent firms in subsidiaries and the age of the venture) explain most of the variation in the degree to which subsidiaries rely on Japanese expatriates. Contrary to previous studies, the capital intensity of production is a key explanatory firm-specific variable that correlates positively with the degree of expatriation. Japanese multinational companies do not rely on expatria127=tes to off-set host-country risk, but to mitigate risk to parent investment in subsidiaries.

Keywords: Economie; quantitative (search for similar items in EconPapers)
Date: 2015-07
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Citations: View citations in EconPapers (3)

Published in Asia Pacific Business Review, 2015, 21 (3), pp.383--402. ⟨10.1080/13602381.2015.1022426⟩

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Related works:
Journal Article: Do Japanese MNCs use expatriates to contain risk in Asian host countries? (2015)
Working Paper: Do Japanese MNCs use Expatriates to Contain Risk in Asian Host Countries? (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-01456121

DOI: 10.1080/13602381.2015.1022426

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