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DIVISION HEADQUARTERS GO ABROAD ‐ A STEP IN THE INTERNATIONALIZATION OF THE MULTINATIONAL CORPORATION *
Author(s) -
Forsgren Mats,
Holm Ulf,
Johanson Jan
Publication year - 1995
Publication title -
journal of management studies
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 4.398
H-Index - 184
eISSN - 1467-6486
pISSN - 0022-2380
DOI - 10.1111/j.1467-6486.1995.tb00785.x
Subject(s) - multinational corporation , subsidiary , internationalization , corporation , division (mathematics) , business , division of labour , power (physics) , international trade , economic geography , economics , market economy , finance , physics , arithmetic , mathematics , quantum mechanics
Why are division headquarters of multinational corporations in some cases located abroad? In the multinational corporation the physical location of division headquarters is a problematic issue because of the need for close links both to corporate headquarters and the foreign subsidiaries. This paper develops a model explaining this location as a consequence of power relations associated with the internationalization of the corporation and tests it on a sample of divisions of Swedish multinationals. the results support the view that power relations have an impact on location of division headquarters. One interesting result is the clear indication of countervailing forces, consisting of an attraction force of foreign dominant subsidiaries and a resisting force related to the interests of corporate headquarters.