Home country (in)stability and the locational portfolio construction of emerging market multinational enterprises

Da Silva Luiz, John and Barnard, Helena (2022) Home country (in)stability and the locational portfolio construction of emerging market multinational enterprises. Journal of Business Research, 151. pp. 17-32. ISSN 0148-2963

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Emerging markets often experience instability due to rapid changes to the institutional environment, social changes like rapid urbanization, or even unrest. We argue that emerging market multinationals (EMNEs) manage such instability by constructing and changing locational portfolios, and qualitatively analyze six cases in South Africa over a period that included the entrenchment of Apartheid, increasing resistance to it, the immediate post-Apartheid era, and finally the period of state capture. The four periods of (in)stability – initial tenuous stability, extreme instability, comprehensive stability, and finally growing instability – differently affected EMNEs’ location choices. EMNEs went to proximate developing countries when the home country was relatively stable, but left for host countries in the developed world once the home country became unstable. Few EMNEs capitalized on their experience there once home-country stability returned, instead returning to emerging markets. These patterns are best explained by a portfolio logic that takes into account home-country environmental dynamism.

Item Type: Article
Keywords: EMNE, Africa, institutions, instability, uncertainty, trajectories, internationalization, location choice
Schools and Departments: University of Sussex Business School > Strategy and Marketing
SWORD Depositor: Mx Elements Account
Depositing User: Mx Elements Account
Date Deposited: 23 Jun 2022 11:08
Last Modified: 27 Apr 2023 10:25
URI: http://sro.sussex.ac.uk/id/eprint/106525

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