- Seminars
- Multinational Enterprises and Foreign Direct Investments (FDI). Entry strategy, innovation capabilities, and the competitive challenge from China
Multinational Enterprises and Foreign Direct Investments (FDI). Entry strategy, innovation capabilities, and the competitive challenge from China
Speaker
Bruce McKern - University Technology Sidney
Date
Oct 9, 2019 - Time:
16:15
e 11/10/2019 ore 13.45 - VM3 (Vicenza)
Why is a large proportion of economic relations between nations conducted by multinational enterprises operating in foreign countries, rather than by arms’ length trade? Why do MNEs choose to own and control their foreign operations rather than license other firms? What is the source of their ability to compete?
In this session we will start with the MNE from the developed world and the OLI model (Ownership, Location, Internalisation). We’ll discuss country-specific advantages and firm-specific advantages.
Given the long experience and capabilities of established MNEs, how is that developingcountry-basedMNEs are increasingly successful ? Does their success challenge the traditional explanations?
2. Foreign market entry:
The “liability of foreignness”. Evaluation of host country “distances”: culture, markets, institutions (incl. government), technology. Dealing with “distances”.
Entry strategy: export, license, or subsidiary. If subsidiary, greenfield, 100% acquisition, or joint venture?
This is an example of the challenges of competing in a foreign market. Although it’s not new (China in the 2000s) its lessons apply today to multinational companies entering other rapidly developing economies. It helps us to understand the “liability of foreignness” that firms face when they enter a market that is very different from their home base, and where they face competitors who are more skilful at navigating their home environment. Firms have to balance the rewards they can reap in the foreign market against the risks of investing capital in an environment that they may not understand.
The case study describes how the US giant eBay brought its on-line auction market into China by acquiring a Chinese company called EachNet, based on eBay’s highly successful US business model. Yet eBay was quickly challenged by a new competitor, Taobao, launched by Alibaba.com.
In this session we will start with the MNE from the developed world and the OLI model (Ownership, Location, Internalisation). We’ll discuss country-specific advantages and firm-specific advantages.
Given the long experience and capabilities of established MNEs, how is that developingcountry-basedMNEs are increasingly successful ? Does their success challenge the traditional explanations?
2. Foreign market entry:
The “liability of foreignness”. Evaluation of host country “distances”: culture, markets, institutions (incl. government), technology. Dealing with “distances”.
Entry strategy: export, license, or subsidiary. If subsidiary, greenfield, 100% acquisition, or joint venture?
This is an example of the challenges of competing in a foreign market. Although it’s not new (China in the 2000s) its lessons apply today to multinational companies entering other rapidly developing economies. It helps us to understand the “liability of foreignness” that firms face when they enter a market that is very different from their home base, and where they face competitors who are more skilful at navigating their home environment. Firms have to balance the rewards they can reap in the foreign market against the risks of investing capital in an environment that they may not understand.
The case study describes how the US giant eBay brought its on-line auction market into China by acquiring a Chinese company called EachNet, based on eBay’s highly successful US business model. Yet eBay was quickly challenged by a new competitor, Taobao, launched by Alibaba.com.
- Data pubblicazione
- Oct 7, 2019
- Contact person
- Angelo Zago
- School
- Economics and Management
ATTACHMENTS
- Locandina
