Decision-Making Autonomy and Subsidiary Innovation

Dut Van Vo, Sjoerd Beugelsdijk, Gjalt de Jong, Björn Jindra

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    Abstract

    This paper investigates how decision-making autonomy affects the possibility and intensity of innovation in subsidiaries of multinational enterprises (MNEs). Subsidiaries are increasingly identified as sources of innovation and as vehicles for cross-border transfer of new competences. The question of how much decision-making autonomy subsidiaries should have is a core issue in the management of headquarters-subsidiary relationships. Using two complementary theoretical perspectives, we hypothesize a non-linear relationship between subsidiary’s decision-making autonomy and innovation. We test our hypothesis in a multi-country and multiindustry database based on survey evidence of 134 subsidiaries located in five Central and Eastern European countries from 23 home countries. The empirical results provide support for a non-linear U shaped relationship between subsidiary decision-making autonomy and innovation intensity.
    Original languageEnglish
    Title of host publicationProceedings of the 55th Annual Meeting of the Academy of International Business
    EditorsPatricia McDougall-Covin, Tunga Kiyak
    Place of PublicationEast Lansing, MI
    PublisherAcademy of International Business
    Publication date2013
    Pages63
    Publication statusPublished - 2013
    EventAIB 2013 Annual Meeting : Bridging the Divide: Linking IB to Complementary Disciplines and Practice - Sabancı University, Koç University, and Özyeğin University, Istanbul, Turkey
    Duration: 3 Jul 20136 Jul 2013
    Conference number: 55
    http://aib.msu.edu/events/2013/

    Conference

    ConferenceAIB 2013 Annual Meeting
    Number55
    LocationSabancı University, Koç University, and Özyeğin University
    CountryTurkey
    CityIstanbul
    Period03/07/201306/07/2013
    Internet address
    SeriesAcademy of International Business. Annual Meeting. Proceedings
    Volume55
    ISSN2078-4430

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