Elgar original reference
Edited by Alain Verbeke and Hemant Merchant
Chapter 6: Triple testing the quality of multinationality–performance research
The international business literature has suggested various linkages between multinationality (M) and performance (P). A number of authors have recently put forward an S-shaped curve, allegedly describing a generalized MP relationship. However, internalization theory, in line with Buckley and Casson (1976), Hennart (1982) and Hennart (2007), challenges the concept itself of such a generalized relationship between these two parameters. This chapter adopts an internalization theory perspective, meant to improve the design of MP studies, and cautions against assuming too quickly a generalized MP relationship. In line with internalization theory, we argue that firm-level performance depends primarily on the characteristics of the companies’ firm-specific advantages (FSAs) rather than on their degree of multinationality. We propose triple testing the quality of MP studies by assessing how well they address the various challenges related to conceptualizing and measuring M, P and the MP relationship itself.
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