Institutional Antecedents of Subsidiary External Embeddedness: Coping with Regulatory Competitive Constraints

Grazia D. Santangelo, Henrik Dellestrand, Ulf Andersson

Publikation: Bidrag til tidsskriftTidsskriftartikelForskningpeer review

Abstrakt

We investigate institutional antecedents to subsidiary external embeddedness and relate regulation constraining competition in local service sectors to subsidiary embeddedness with local partners in complementary sectors. Combining research on business networks with arguments derived from transaction cost economics, we argue that subsidiary external embeddedness depends on the extent of transaction costs originating from small numbers bargaining, which regulatory competitive constraints in local service sectors are a source of. Based on this logic, we suggest that low and high levels of regulatory competitive constraints are associated with greater subsidiary external embeddedness. We also suggest that this U-shaped relationship is more pronounced for subsidiaries that are centers of excellence within the multinational enterprise because these subsidiaries heavily depend on the local context as a source of their competitive advantage over their sister subsidiaries.
OriginalsprogEngelsk
Artikelnummer101851
TidsskriftLong Range Planning
Vol/bind52
Udgave nummer4
Antal sider14
ISSN0024-6301
DOI
StatusUdgivet - aug. 2019

Bibliografisk note

Published online: 4. October 2018

Emneord

  • External business embeddedness
  • Institutions
  • Factors market
  • Foreign subsidiary
  • Center of excellence

Citationsformater