Evolutionary theory and the advantage paradox of multinational corporations: testing the effects of subsidiary embeddedness and autonomy on innovation development and transfer intensities
2011 (English)In: Academy of Management Annual Meeting Proceedings, 2011 / [ed] Leslie Toombs, 2011, 1-6 p.Conference paper (Refereed)
This paper focuses on innovation development and transfer in multinational corporations. We use the evolutionary theory of the multinational company as our point of departure and confront it with the advantage paradox of such organizations. Evolutionary theory on the multinational corporation argues that the more innovations are developed, the more the subsidiary is transferring them internally within the organization. However, there are studies indicating that, due to the multiplicity of roles, a subsidiary increasingly engaged in development activities has difficulties engaging in transfer activities. This suggest that there is an advantage paradox connected to the evolutionary theory of the multinational corporation in that being competent at developing innovations does not necessarily lead to the fact that such innovations become transferred. In the paper we explore the effects of external embeddedness and subsidiary autonomy on subsidiary innovation development, and these three dimensions are subsequently linked to subsidiary innovation transfer intensity. Our analysis suggests that embeddedness and autonomy is enhancing subsidiary innovativeness but does not contribute to transfer intensity. However, we can confirm that the more a subsidiary is innovating, although being embedded and autonomous, the more it will engage in innovation transfer to sister subsidiaries. Consequently, this paper addresses core dimensions of evolutionary theory, finding support for its arguments, while we cannot find support for the advantage paradox of multinational corporations.
Place, publisher, year, edition, pages
2011. 1-6 p.
, Academy of Management Annual Meeting Proceedings, ISSN 2151-6561
autonomy, evolutionary theory, advantage paradox
Research subject Business Studies
IdentifiersURN: urn:nbn:se:uu:diva-156652DOI: 10.5465/AMBPP.2011.65870404OAI: oai:DiVA.org:uu-156652DiVA: diva2:432760
Academy of Management