The contribution of internalisation theory to international business: New realities and unanswered questions

Abstract

Journal of World Business Special Issue -50 th Anniversary I would like to thank Björn Ambos, an anonymous referee and Jonathan Doh for comments on earlier versions. AbstractThis paper sets out the importance of internalisation theory to international business research and practice. It examines the context against which the theory has been developed, the environmental conditions in which the multinational enterprise has evolved and the phenomena that the theory has explained. It also examines the challenge to the theory of "unanswered questions". These include governance, location theory, dynamics, networked multinationals, innovation, entrepreneurship and the role of risk and uncertainty.

Internalisation Theory and Outward Direct Investment by Emerging Market Multinationals

“…Its future strategy then is predicated on the creation and protection of rents by erecting barriers that are essentially informational in nature-''isolating mechanisms'' in (Rumelt's 1984) terms. This brings the resource based view very close to internalisation theory (Buckley 2016).…”

“…Networks provide a context for the exercise of entrepreneurial judgement in a volatile environment and thus provide a background for the analysis of entrepreneurship, culture and trust (Buckley and Casson 1988). This is the background for the global systems view of international business (Casson 2000;Buckley and Hashai 2004;Buckley 2016).…”

Career Mobility in a Global Era: Advances in Managing Expatriation and Repatriation

“…Expatriates were typically senior male executives sent by large companies usually headquartered in the US (Buckley, 2015;Perlmutter, 1969) and, possibly Canada or Western Europe, to establish a presence in the wholly-owned subsidiaries of the respective multinationals. Most expatriates were married and hence accompanied by a female trailing spouse and perhaps dependent children (Adler, 1984).…”

Location choices at the subnational level perspective: the case of the Volkswagen Group in BRIC countries

“…The third are the internalisation advantages (I), which refer to a firm's propensity to internalise cross-border structural or endemic imperfections in the intermediate good market (Dunning and Lundan, 2008a). The last advantage is based on internalisation theory, wherein rational agents internalise markets when the predicted benefits exceed the expected costs (Buckley and Casson, 2009), which proved capable of answering the recent challenges of the emerging market firms (Buckley, 2016).…”

“…However, recent studies suggest that institutions directly determine what arrows a firm has in its quiver as it struggle to formulate and implement strategy, and to create competitive advantage (Ingram and Silverman, 2002). Most importantly, prior studies called the need of investigating location choices using a subnational perspective (Beugelsdijk and Mudambi, 2013;Buckley, 2016).…”