Get 20M+ Full-Text Papers For Less Than $1.50/day. Start a 7-Day Trial for You or Your Team.

Learn More →

Knowledge of the firm and the evolutionary theory of the multinational corporation

Knowledge of the firm and the evolutionary theory of the multinational corporation Firms are social communities that specialize in the creation and internal transfer of knowledge. The multinational corporation arises not out of the failure of markets for the buying and selling of knowledge, but out of its superior efficiency as an organizational vehicle by which to transfer this knowledge across borders. We test the claim that firms specialize in the internal transfer of tacit knowledge by empirically examining the decision to transfer the capability to manufacture new products to wholly owned subsidiaries or to other parties. The empirical results show that the less codifiable and the harder to teach is the technology, the more likely the transfer will be to wholly owned operations. This result implies that the choice of transfer mode is determined by the efficiency of the multinational corporation in transferring knowledge relative to other firms, not relative to an abstract market transaction. The notion of the firm as specializing in the transfer and recombination of knowledge is the foundation to an evolutionary theory of the multinational corporation http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of International Business Studies Springer Journals

Knowledge of the firm and the evolutionary theory of the multinational corporation

Download PDF
14 pages

Loading next page...
 
/lp/springer-journals/knowledge-of-the-firm-and-the-evolutionary-theory-of-the-multinational-aVlsxqMMjd

References (108)

Publisher
Springer Journals
Copyright
Copyright © 2003 by Academy of International Business
Subject
Business and Management; Business and Management, general; International Business; Management; Organization; Business Strategy/Leadership
ISSN
0047-2506
eISSN
1478-6990
DOI
10.1057/palgrave.jibs.8400058
Publisher site
See Article on Publisher Site

Abstract

Firms are social communities that specialize in the creation and internal transfer of knowledge. The multinational corporation arises not out of the failure of markets for the buying and selling of knowledge, but out of its superior efficiency as an organizational vehicle by which to transfer this knowledge across borders. We test the claim that firms specialize in the internal transfer of tacit knowledge by empirically examining the decision to transfer the capability to manufacture new products to wholly owned subsidiaries or to other parties. The empirical results show that the less codifiable and the harder to teach is the technology, the more likely the transfer will be to wholly owned operations. This result implies that the choice of transfer mode is determined by the efficiency of the multinational corporation in transferring knowledge relative to other firms, not relative to an abstract market transaction. The notion of the firm as specializing in the transfer and recombination of knowledge is the foundation to an evolutionary theory of the multinational corporation

Journal

Journal of International Business Studies – Springer Journals

Published: Dec 15, 2003

There are no references for this article.