Global Oligopolistic Competition and Multinational Corporations: A Strategic Interation Perspective on Foreign Direct Investment

Michael W. Hansen, Anne Kristin Hoenen

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    Abstract

    The contemporary International Business (IB) literature has ’forgotten’ a key insight of the early foreign direct investment (FDI) literature, namely that FDI often is driven by strategic interaction of multinational corporations (MNCs) in oligopolistic industries. Instead, the IB literature has focused, first on FDI as a way to generate efficiency in cross border transactions, and later on FDI as a way to leverage and build capabilities across borders. In recent decades we have however seen a profound concentration at the global level so that more and more industries can be characterized as global oligopolies. We argue that in this situation there is a pertinent need to ‘rediscover’ the strategic interaction perspective on FDI, but now from a global perspective. Based on early insights of the Industrial Organization FDI tradition as well as on more recent insights from Global Strategic Management, we position the strategic interaction perspective in relation to more conventional perspectives on FDI and develop a typology of generic FDI strategies in global oligopolistic industries.
    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
    Pages241
    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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