This paper investigates local vertical linkages of foreign subsidiaries and the dual role of such linkages as conduits for learning as well as potential channels for spillovers to competitors. On the basis of data from 97 subsidiaries, we analyze the quality of such linkages under varying levels of competition and subsidiary capabilities. Our theoretical development and the results from the analysis document a far more complex and dynamic relationship between levels of competition and MNCs’ local participation in knowledge intensive activities, i.e. learning and spillovers, than previous studies do. We find a curvilinear relationship between the extent of competitive pressure and the quality of local linkages confirming our argument of a trade-off between learning prospects and spillover risks. Furthermore, the level of subsidiary capabilities moderates this relationship.
|Number of pages||44|
|Publication status||Published - 2012|
|Event||AIB 2012 Annual Meeting: Rethinking the Roles of Business, Government and NGOs in the Global Economy - George Washington University and University of Maryland, Washington, United States|
Duration: 30 Jun 2012 → 3 Jul 2012
Conference number: 54
|Conference||AIB 2012 Annual Meeting|
|Location||George Washington University and University of Maryland|
|Period||30/06/2012 → 03/07/2012|
Bibliographical noteCBS Library does not have access to the material
Perri, A., Andersson, U., Nell, P. C., & Santangelo, G. D. (2012). Subsidiary Linkage Patterns: Learning Prospects and Spillover Risks. Paper presented at AIB 2012 Annual Meeting, Washington, United States.