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Multinational subsidiary sales and performance in South East Asia

Nguyen, Q. T. K. and Rugman, A. M. (2015) Multinational subsidiary sales and performance in South East Asia. International Business Review, 24 (1). pp. 115-123. ISSN 0969-5931

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To link to this item DOI: 10.1016/j.ibusrev.2014.07.001


We extend the theory of the multinational enterprise (MNE) by exploring the concept of subsidiary-specific advantages (SSAs) as a driver for subsidiary performance. We investigate the relationship of host country-specific advantages (host CSAs) in the form of market attractiveness, SSAs and subsidiary sales as they affect subsidiary performance. From an original primary dataset of 101 British multinational (MNE) subsidiaries in six South East Asian countries, our analysis reveals three significant findings. First, host market attractiveness has a statistically positive impact on the performance of subsidiaries. Second, the three traditional SSAs of general management, marketing capabilities and invested capital enhance subsidiary performance. Third, we examine geographic direction and types of customers for subsidiary sales by following international accounting standards. We find that these subsidiaries generate on average 95 percent of total sales from the Asia Pacific region and 91 percent of total sales from external customers. Our findings have important research and managerial implications.

Item Type:Article
Divisions:Henley Business School > International Business and Strategy
ID Code:37224
Uncontrolled Keywords:Host country market attractiveness; International accounting standards (IAS 24, IFRS8); Multinational subsidiary sales; Performance; South East Asia; Subsidiary-specific advantages

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