International B
Introduction IB
Course documents, course manual
HBR review
Where: location decision, geography (distance, cultural, economic) so they do cultural training, when it’s not the same.
What type: efficiency & natural resource seeking (cheap in China, oil in Norway) market seeking, strategic asset (knowledge seeking)
Which way: organizational aspect, e.g. entry modes(relationships)
What effect: impact of MNE on home and host country economy society (competition effect, spillover effects)
Psychic distant between NL en DU is not that big, but with JAP en NL it is bigger.
Stand alone resources + routines + recombination skills = firm specific advantages
Two types: location bound: i.e stay in the home country non-location bound or transferable across borders
Firm-specific advantage (FSA) at the firm level manifests itself in a higher productivity of comparable assets (tangible and intangible) than competitors (Caves, 1996). Since imitation of the advantage by competitors entails high costs and high risks,the owner of the advantage is protected for a certain period of time. Since the crucial firm-specific advantages are intangible (including strategic behaviour),they are mobile within the firm at low marginal costs. Hence, integration of value-added activities (Feenstra, 1998) within the firm (i.e., internal exploitation of advantages) is an optimal strategy. Patents is an obvious example of a firm specific advantage
Location-advantage, (or Country-Specific Advantage) on the other hand is immobile and is of a public-good nature as firms have access on equal terms (putting aside congestion problems). As location-advantage is bound to regions, it may lead to geographical fragmentation of value-added activities.
We can see the relationship between Firm and Country Specific Advantage by reference to the quadrant below.
In Quadrant one firms rely on strong low factor costs and energy costs. Cost leadership would be the typical strategy
Quadrant four
Course documents, course manual
HBR review
Where: location decision, geography (distance, cultural, economic) so they do cultural training, when it’s not the same.
What type: efficiency & natural resource seeking (cheap in China, oil in Norway) market seeking, strategic asset (knowledge seeking)
Which way: organizational aspect, e.g. entry modes(relationships)
What effect: impact of MNE on home and host country economy society (competition effect, spillover effects)
Psychic distant between NL en DU is not that big, but with JAP en NL it is bigger.
Stand alone resources + routines + recombination skills = firm specific advantages
Two types: location bound: i.e stay in the home country non-location bound or transferable across borders
Firm-specific advantage (FSA) at the firm level manifests itself in a higher productivity of comparable assets (tangible and intangible) than competitors (Caves, 1996). Since imitation of the advantage by competitors entails high costs and high risks,the owner of the advantage is protected for a certain period of time. Since the crucial firm-specific advantages are intangible (including strategic behaviour),they are mobile within the firm at low marginal costs. Hence, integration of value-added activities (Feenstra, 1998) within the firm (i.e., internal exploitation of advantages) is an optimal strategy. Patents is an obvious example of a firm specific advantage
Location-advantage, (or Country-Specific Advantage) on the other hand is immobile and is of a public-good nature as firms have access on equal terms (putting aside congestion problems). As location-advantage is bound to regions, it may lead to geographical fragmentation of value-added activities.
We can see the relationship between Firm and Country Specific Advantage by reference to the quadrant below.
In Quadrant one firms rely on strong low factor costs and energy costs. Cost leadership would be the typical strategy
Quadrant four