MNE Entrepreneurial Capabilities at Intermediate Levels: The Roles of External Embeddedness and Heterogeneous Environments

This study investigates the entrepreneurial capabilities of MNE units at intermediate geographical levels, between the local subsidiary level and global corporate headquarters. In our conceptual development, we build on the entrepreneurship and MNE embeddedness literature to explain how MNE units at intermediate geographical levels differ from local subsidiaries and global corporate headquarters, and why those differences are important. We illustrate our arguments using data on European regional headquarters (RHQs). We find that RHQs' entrepreneurial capabilities depend on their external embeddedness and on the heterogeneous information that is generated through dissimilar markets within the region. Our study opens up for an interesting discussion of the independence of these mechanisms. In sum, we contribute to the understanding of the entrepreneurial role of intermediate units in general and RHQs in particular.