Location, Technology and Innovation
Chapter 1: Introduction: multinational enterprises, innovation and geography in todays’ globalized world
The existence and behaviour of the multinational enterprise (MNE) has now been analysed for over half a century by economists, international business and management researchers, behavioural and organizational theorists, as well as business historians and sociologists. In spite of the diversified theoretical roots and backgrounds of these different traditions, two main sets of questions have been commonly addressed by social scientists. The first set relates to the behavioural determinants, motives, and strategies of multinational firms, and includes questions such as: why do firms become multinational? where do they locate their cross-border activities? how do they undertake and organize their multinational production and transactions? The second set of questions relates to the wider effects of a multinational presence, and includes questions such as: what is the impact on the home economy? what is the effect on the host economy? and what is the effect on the multinational firm itself? These two broad lines of inquiry have been further decomposed into a variety of related, but differentiated, sub- questions. What is apparent, after more than fifty years of systematic research on multinationality, is that there is as yet no unified or dominant theory of the MNE.