Do Multinationals Transplant their Business Model?

Dalia Marin, Linda Rousová and Thierry Verdier

Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems from Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich

Abstract: What determines whether or not multinational firms transplant their mode of organisation to other countries? We embed the theory of knowledge hierarchies in an industry equilibrium model of monopolistic competition to examine how the economic environment may affect the decision of a multinational firm about transplanting its business organisation to other countries. We test the theory with original and matched parent and affiliate data on the internal organisation of 660 Austrian and German multinational firms and 2200 of their affiliate firms in Eastern Europe. We find that three factors stand out in promoting the multinational firm’s decision to transplant the business model to the affiliate firm in the host country: a competitive host market, the corporate culture of the multinational firm, and when an innovative technology is transferred to the host country. These factors increase the respective probabilities of organisational transfer by 18.5 percentage points, 37, and 31 percentage points.

Keywords: organisational economics of multinational firms; trade and organisations; the theory of the firm; organisational transfer between countries (search for similar items in EconPapers)
JEL-codes: D23 F12 F23 F61 (search for similar items in EconPapers)
Date: 2013-04
New Economics Papers: this item is included in nep-bec and nep-int
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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Related works:
Journal Article: Do Multinationals Transplant their Business Model? (2021)
Working Paper: Do Multinationals Transplant their Business Model? (2021)
Working Paper: Do Multinationals Transplant their Business Model? (2021)
Working Paper: Do Multinationals Transplant Their Business Model? (2019)
Working Paper: Do Multinationals Transplant their Business Model? (2013)
Working Paper: Do Multinationals Transplant their Business Model? (2013)
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