How "space" and "place" influence subsidiary host country political embeddedness

Klopf, Patricia and Nell, Phillip C. (2018) How "space" and "place" influence subsidiary host country political embeddedness. International Business Review, 27 (1). pp. 186-197. ISSN 0962-9262

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Abstract

As a part of multinational corporations (MNCs), subsidiaries operate in distinct host countries and have to deal with their external context. Host country political embeddedness, in particular, helps subsidiaries to obtain knowledge and understanding of the regulatory and political context, and to get access to local networks. Moreover, they get some guidance and support from their headquarters. Distance between MNC home and host countries, however, alienates subsidiaries from the MNC and influences the extent of subsidiary host country political embeddedness. We suggest that the host country political and regulatory context moderates the effect of distance on subsidiary host country political embeddedness by reducing the need and/or value of headquarters support. Using a sample of 124 European manufacturing subsidiaries, we find that distance (space) and context (place) matter jointly: the impact of distance is stronger for subsidiaries that operate in host countries with low governance quality and low political stability in place.

Item Type: Article
Additional Information: This article is in press, a corrected proof. To see the final version of this paper please visit the publisher's website. Access to the published version requires a subscription. The original publication is available at http://www.elsevier.com.
Keywords: Political embeddedness, MNC subsidiaries, headquarters-subsidiary relationships, institutional theory, distance, institutions
Divisions: Departments > Welthandel > International Business > Nell
Version of the Document: Accepted for Publication
Depositing User: Gertraud Novotny
Date Deposited: 01 Dec 2017 10:27
Last Modified: 14 Jul 2019 14:46
Related URLs:
FIDES Link: https://bach.wu.ac.at/d/research/results/82106/
URI: https://epub.wu.ac.at/id/eprint/5889

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