National capital city location and subsidiary portfolio expansion: The negative effect of geographic distance to the capital city at inception on the speed of subsequent investments

• 成果类型: Article
• 署名作者: Hutzschenreuter, Thomas; Harhoff, Philippa-Luisa
• 署名单位: Technical University of Munich; WHU - Otto Beisheim School of Management
• 刊物名称: JOURNAL OF INTERNATIONAL BUSINESS STUDIES
• ISSN/ISSBN: 0047-2506
• DOI: 10.1057/s41267-020-00305-1
• 发表日期: 2020
• 页码: 1107-1132
• 关键词: internationalization; MNEs; expansion speed; subsidiary portfolio; capital cities; GEOGRAPHIC DISTANCE

摘要

A multinational enterprise develops its subsidiary portfolio by investing in new foreign markets and subsequently pursuing further investments within these host countries. We find that firms which locate their first equity investment closer to the national capital city can subsequently expand their subsidiary portfolio within the host country at a higher speed. This effect is particularly strong in emerging economies. Further analyses of various contingencies support the robustness of our findings. We discuss different theoretical mechanisms which could cause these effects, in particular face-to-face interactions with governmental actors and opportunities to develop political connections. Our research contributes to the literature on internationalization processes by analyzing how the initial location choice affects the development of the subsidiary portfolio.