The Global Factory
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The Global Factory

Networked Multinational Enterprises in the Modern Global Economy

Peter J. Buckley

This key new book synthesises Peter Buckley's work on ‘the global factory’ – the modern networked multinational enterprise. The role of interfirm networks, entrepreneurship and cooperation in the creation and management of global factories leads to a discussion of their governance, internal knowledge transfer strategies and performance, including their role in potentially combating societal failures. Emerging country multinationals are examined as a special case of global factories with a focus on Indian and Chinese multinationals, their involvement in tax havens and offshore financial centres, the performance and processes of their acquisition strategies – all seen as key aspects of globalisation.
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Chapter 10: The role of technological catch up and domestic market growth in the genesis of emerging country based multinationals

Networked Multinational Enterprises in the Modern Global Economy

Peter J. Buckley and Niron Hashai


The paper presents a model that evaluates how upgraded technological capabilities of emerging country based multinationals (EMNCs) and an increase in the domestic market size of large emerging countries affect value chain location choices and the competitiveness of emerging country based firms versus advanced country based ones. The model shows that, even without possessing a competitive advantage in terms of technology and/or brands, EMNCs from large or rapidly technologically advancing countries can become dominant players in the global system. The model highlights the central role of firm level technological intensity and product differentiation in determining the location of value chain activities as well as defining organisational boundaries. Empirical analysis of the location choices of the world's top multinationals from large advanced and emerging countries in 2010 supports the model's predictions.

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