Globalization and Location Choice: An Analysis of US Multinational Firms in 1980 and 2000

Journal of International Business Studies, 2007

Posted: 20 Aug 2007

See all articles by Ricardo G. Flores

Ricardo G. Flores

UNSW Australia Business School, School of Management

Ruth V. Aguilera

Northeastern University - Department of International Business and Strategy

Abstract

In this paper we examine foreign location choices of the top 100 US multinational corporations (MNCs) in 1980 and 2000. We first ask whether there has been a change in MNC foreign location choice in this two-decade period. Second, we explore the underlying reasons of location change by focusing on country-level factors, accounting for firm-, industry- and regional level explanations. Our findings suggest, first, that the extent of MNCs' activities around the globe is more extensive than assumed by regionalists' arguments and well beyond Ohmae's TRIAD, but still less widespread than claimed by the globalists - the two main traditions within the globalization-regionalization debate. Second, we uncover an interesting de-location pattern in this period. Third, we develop an integrative framework where both economic and institutional-cultural arguments are shown to influence MNCs' foreign location choice in different ways. We conclude with a discussion of our findings, and provide suggestions for future research.

Keywords: MNC foreign location choice, host country factors, global strategy, regional strategy, globalization

JEL Classification: F23, M10, M21

Suggested Citation

Flores, Ricardo G. and Aguilera, Ruth V., Globalization and Location Choice: An Analysis of US Multinational Firms in 1980 and 2000. Journal of International Business Studies, 2007, Available at SSRN: https://ssrn.com/abstract=1007820

Ricardo G. Flores (Contact Author)

UNSW Australia Business School, School of Management ( email )

Gate 11, Botany Street, Randwick
Sydney, NSW 2052
Australia

HOME PAGE: http://www.asb.unsw.edu.au/schools/Pages/RicardoFlores.aspx

Ruth V. Aguilera

Northeastern University - Department of International Business and Strategy ( email )

Boston, MA 02115
United States

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