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The Conundrum of Home-country Political Embeddedness: Impact on Reverse Knowledge Transfer in Emerging-market Multinationals
Uppsala University, Disciplinary Domain of Humanities and Social Sciences, Faculty of Social Sciences, Department of Business Studies.
2018 (English)Doctoral thesis, comprehensive summary (Other academic)
Description
Abstract [en]

Emerging-market multinational corporations (EMNCs), particularly state-owned ones, have been increasingly active players in the global arena and have become a significant feature of the global business landscape. Research on EMNCs has focused on their distinctive features, particularly on their politically embedded nature in home institutions. Another important feature in this field is the aim of knowledge-related asset augmentation overseas via strategic asset-seeking investments, conceptualized as a springboard perspective. In this vein, reverse knowledge transfer from subsidiaries to home-country organizations becomes critically significant in order for EMNCs to achieve the innovation catch-up. In response to the rise of EMNCs, this thesis focuses on the two above-mentioned core features of EMNCs by looking specifically at the impact of the home-country political embeddedness of EMNCs on reverse knowledge transfer. 

The empirical investigation uses a sequential mixed-method approach that is comprised of qualitative research via a single case study of one Chinese state-owned multinational and quantitative research via a survey of 99 Chinese multinationals and their 177 overseas subsidiaries. The findings, based on empirical data, show, on one hand, that headquarters’ strong political embeddedness triggers strong intentions to seek and acquire knowledge from subsidiaries, particularly in advanced markets, through aligning with government objectives or shaping organizational distance between headquarters and subsidiaries. On the other hand, headquarters’ strong political embeddedness hampers reverse knowledge transfer practices in EMNCs by engendering a number of organizational barriers, including a low level of headquarters’ absorptive capacity, inferior performance of headquarters’ entrepreneurial role, less willingness of subsidiaries to transfer knowledge, and larger organizational distance between headquarters and subsidiaries. Consequently, headquarters’ political embeddedness acts as both a driver and a barrier to reverse knowledge transfer, which creates a paradox. This finding contrasts with those of most prior studies, where political relations were found to be a source of competitive advantage for international expansion.

By stressing the importance of home-country political embeddedness in reverse knowledge transfer, this thesis extends the literature on the subject and advances the conceptualizations of the differentiated network multinationals and the embedded multinationals, which have focused almost exclusively on subsidiary embeddedness and ignored headquarters’ embeddedness in a home context. The present thesis also contributes to the literature on the parenting role of headquarters by providing evidence in support of a pessimistic view of headquarters’ parenting advantage and identifying political embeddedness as an important element that contributes to the value-creating/destroying role of headquarters in the EMNC context.

Place, publisher, year, edition, pages
Uppsala: Acta Universitatis Upsaliensis, 2018. , p. 139
Series
Doctoral thesis / Företagsekonomiska institutionen, Uppsala universitet, ISSN 1103-8454 ; 195
Keywords [en]
emerging-market multinational corporations, political embeddedness, reverse knowledge transfer, headquarters
National Category
Social Sciences Business Administration
Research subject
Business Studies
Identifiers
URN: urn:nbn:se:uu:diva-349162ISBN: 978-91-506-2702-2 (print)OAI: oai:DiVA.org:uu-349162DiVA, id: diva2:1199819
Public defence
2018-06-13, Lecture Hall 2, Ekonomikum, Kyrkogårdsgatan 10A, Uppsala, 13:15 (English)
Opponent
Supervisors
Available from: 2018-05-23 Created: 2018-04-23 Last updated: 2018-05-23
List of papers
1. Conceptualizing political embeddedness: Relevance for state-owned enterprises and emerging-market firms
Open this publication in new window or tab >>Conceptualizing political embeddedness: Relevance for state-owned enterprises and emerging-market firms
(English)In: Article in journal (Refereed) Submitted
National Category
Business Administration
Identifiers
urn:nbn:se:uu:diva-349156 (URN)
Available from: 2018-04-22 Created: 2018-04-22 Last updated: 2018-05-02
2. Knowledge sourcing from advanced markets subsidiaries: political embeddedness and reverse knowledge transfer barriers in emerging-market multinationals
Open this publication in new window or tab >>Knowledge sourcing from advanced markets subsidiaries: political embeddedness and reverse knowledge transfer barriers in emerging-market multinationals
2017 (English)In: Industrial and Corporate Change, ISSN 0960-6491, E-ISSN 1464-3650, Vol. 26, no 2, p. 311-332Article in journal (Refereed) Published
Abstract [en]

This article focuses on emerging-market multinationals and their intent to source knowledge from advanced countries. A single in-depth case study of a Chinese state-owned multinational is used to shed light on the relationship between political embeddedness and the potential to reverse knowledge transfer from advanced market subsidiaries. Specifically, we argue that a strong home-country political embeddedness enhances specific organizational barriers to reverse knowledge transfer, which undermines the strategic intent of knowledge-seeking internationalization, common to much Foreign Direct Investment (FDI) by emerging-market multinationals in recent years. This article contributes to research on knowledge sourcing within the context of south-north FDI by highlighting specific effects of political embeddedness at organizational level, which are critical for the possibilities to reverse knowledge transfer; our study is also relevant to international business, as new empirical insights related to the international organization and management of state-owned multinationals are discussed.

National Category
Business Administration
Identifiers
urn:nbn:se:uu:diva-321347 (URN)10.1093/icc/dtx001 (DOI)000397948400007 ()
Available from: 2017-05-03 Created: 2017-05-03 Last updated: 2018-10-21
3. The paradox of political ties on headquarters-subsidiary motives for knowledge transfer in Chinese multinationals: The importance of organizational distance
Open this publication in new window or tab >>The paradox of political ties on headquarters-subsidiary motives for knowledge transfer in Chinese multinationals: The importance of organizational distance
(English)In: Article in journal (Refereed) Submitted
National Category
Social Sciences Business Administration
Identifiers
urn:nbn:se:uu:diva-349154 (URN)
Available from: 2018-04-22 Created: 2018-04-22 Last updated: 2018-10-21
4. The liability of political embeddedness in emerging-market multinationals: Effects on reverse knowledge transfer
Open this publication in new window or tab >>The liability of political embeddedness in emerging-market multinationals: Effects on reverse knowledge transfer
(English)In: Article in journal (Refereed) Submitted
National Category
Business Administration
Identifiers
urn:nbn:se:uu:diva-349155 (URN)
Available from: 2018-04-22 Created: 2018-04-22 Last updated: 2018-04-25

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