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This study aims to explore how subsidiary capabilities collectively configure for performance. Additionally, it seeks to examine whether these configurations of capabilities can provide equifinal solutions through developing a comprehensive research framework that focuses on subsidiaries in China.

With a data set collected through a questionnaire from 172 Korean multinational enterprises (MNEs) in China, this study used a fuzzy-set qualitative comparative analysis to detect the capability conditions and configurations. These configurations represent combinations of various subsidiary capabilities linked to high performance.

This study identified several complex pathways with distinct configurations for high subsidiary performance. The findings demonstrate the importance of configurations over individual conditions. Thus, the results highlight that the effectiveness of diverse capabilities, which are widely believed to singularly contribute to the high performance of MNE subsidiaries, depends on how each combines with other capabilities. Overall, the findings provide a richer and fine-grained understanding of the role and relative importance of various forms of MNE subsidiary capabilities and how the joint effect of these subsidiaries contributes to high performance.

This study suggests that MNE managers should comprehensively understand how subsidiary capabilities are configured to produce subsidiary performance outcomes. This specifically illustrates the importance of understanding the mutually conflicting yet collectively exhaustive results of multi-selective solutions and aims to align with China’s industrial and regional heterogeneity.

By examining the role of MNE subsidiary capability configurations, which may collectively influence the subsidiary’s performance, this study contributes to the literature. It elucidates how MNE subsidiaries may achieve superior performance by developing and possessing various capabilities tailored to the local context.

The foreign direct investment (FDI) motivations of emerging market multinational enterprises (EMNEs) are mainly twofold: acquisition of strategic assets in foreign markets, and foreign market penetration. While prior studies have delivered valuable insights, findings regarding the performance of those two types of FDI remain somewhat inconsistent or inconclusive. This study aims to develop complementary perspectives that can motivate scholars to explore the internal mechanisms of achieving goals for these two FDI types by providing a review of prior literature on EMNEs’ knowledge- and market-seeking FDI.

Indexed to the EBSCO database and Google Scholar from 2000 to 2020, 73 articles from 13 journals were selected and reviewed to identify the main research future research agendas.

Our findings show that the purpose of EMNEs’ FDI can be divided into value creation and value capturing, with the former pursuing knowledge-seeking and the latter pursuing market-seeking, according to our study, which draws on insights from innovation-focused literature.

International business (IB) scholars have extensively studied both knowledge-seeking and market-seeking outward FDI of EMNEs for decades. Our study contributes to the literature by providing the potential for integrating IB and innovation studies to extend the scope of EMNEs studies.

How much variance in firm performance can be attributed to firms’ corporate political activities (CPA)? Under what conditions does CPA contribute to firm performance? To theorize and empirically tackle these questions, we build on the resource-based view (RBV) to theorize how CPA might improve or hinder firm performance, and specifically examine the direct relationship between firms’ investments in lobbying activities and their performance. We also expect firm growth rate to moderate the relationship between lobbying and performance.

We empirically test our hypotheses using large-scale longitudinal panel data from publicly traded US firms from 2008 to 2018.

Our analyses support our predictions of the double-edged sword effect of lobbying on firm performance. Moreover, our results show that this effect is steeper for firms with higher growth rates.

Our study contributes meaningful insights to strategy scholarship on the influence of nonmarket strategies, highlighting the relevance of firm-specific conditions in shaping the performance outcomes of such strategies. In particular, we make a contribution by identifying a nonlinear relationship between lobbying and firm performance, which is amplified in fast-growing firms compared to stagnant ones.

The rise of emerging economies in the innovation landscape has often been attributed to the positive spillovers of innovation capabilities from multinational corporations (MNCs). However, it is less certain that their innovative capabilities imported from the home country function effectively in the host country from the outset. This study examines the performance of the innovation capabilities of MNC subsidiaries in emerging economies over time by considering the gradual process of their learning about host countries.

We employed stochastic frontier analysis to measure innovation capabilities, our focal construct. For regression analysis, we applied the Mundlak estimator, a variant of the fixed-effects panel estimator, to a sample comprising subsidiaries of MNCs from technologically advanced nations operating in Korea between 2006 and 2016.

Our results indicate that the innovation capabilities of MNC subsidiaries initially underperform those of local firms but improve over time, eventually surpassing the capabilities of their local counterparts. Furthermore, our findings reveal that institutional distance amplifies the underperformance of the innovation capabilities of MNC subsidiaries.

This study contributes to the literature by extending both theoretical development and empirical measurement of innovation capabilities in cross-national settings. Additionally, it deepens our understanding of whether and how MNC subsidiaries adapt their innovation capabilities to the local market environment.

This study aims to examine whether diversified economies enhance the growth benefits from foreign direct investment (FDI). Diversified economies benefit from stable export earnings, stable investment composition and greater factor endowments through forward and backward linkages that can leverage superior foreign technology embedded in FDI. This is crucial as many African economies suffer from dependency while FDI is concentrated in the primary sector.

The authors use a dataset of 15 Economic Community of West African States from 1995 to 2020 and compile variables from various sources, including an export diversification index measured using the Herfindahl–Hirschman index of product concentration. The authors use a growth regression model estimated using dynamic panel estimators to control for endogeneity and simultaneity issues.

The results show that the effects of direct FDI are insignificant to growth considering diversification and controlling for other confounding factors. Meanwhile, diversification is associated with growth, which highlights the importance of industrial policy. More importantly, the authors find that the marginal effects of FDI are positively and significantly associated with growth when diversification levels are low, implying that production structure matters for the FDI–growth nexus in developing economies.

Previous studies have overlooked the role of export production structure on the FDI–growth nexus. Many developing economies are dependent on primary exports and suffer from dependency, which implies lower levels of factor endowments. As such, this reduces the growth gains from FDI. The authors provide new empirical evidence on the importance of export production structure on the FDI–growth nexus.