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Competitive Advantage and the Existence of the Multinational Corporation: Earlier Research and the Role of Frictions
Author(s) -
Asmussen Christian Geisler,
Foss Nicolai J.
Publication year - 2014
Publication title -
global strategy journal
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 2.814
H-Index - 24
eISSN - 2042-5805
pISSN - 2042-5791
DOI - 10.1111/j.2042-5805.2013.01068.x
Subject(s) - multinational corporation , extant taxon , competitive advantage , industrial organization , corporation , counterpoint , work (physics) , business , neoclassical economics , international business , economics , positive economics , law and economics , marketing , sociology , management , finance , evolutionary biology , engineering , biology , mechanical engineering , pedagogy
This article provides a counterpoint to Hashai and Buckley's article ‘Is competitive advantage a necessary condition for the emergence of the multinational enterprise?’ We agree with their conclusion that it is, in fact, not a necessary condition, but argue that the theoretical reasons behind this are different and more diverse than the ones they propose. We suggest that much extant economic theory is, in fact, consistent with their view that firms may internationalize without owning or achieving competitive advantages, and we model various other ways in which imperfections can drive their overall result. We strongly applaud Hashai and Buckley's attempt to add more rigor to international business theory and call for future work to extend this debate.