Texas A&M University
Caught in the Crossfire: Strategies of Multinationals in Host Countries at War.
Degree: PhD, Management, 2012, Texas A&M University
This dissertation examines the strategic choices of multinational enterprises (MNEs) in host countries that become engaged in war. By combining the resource-based view and resource management theory, and drawing additional insights from research on real options and foreign strategic exit, I link the costs attributable to war to the strategic responses of the MNE at the subsidiary level in a novel firm-vulnerability framework. In particular, I develop theory regarding whether a subsidiary will exit from a host country, and if so, the timing (early or late) and mode (whole or partial) of exit.
I test my hypotheses on a sample of 626 subsidiaries from 386 Japanese MNEs representing 51 industries in 23 countries at war, both interstate and civil, over the period 1988 to 2006. In analyzing the exit likelihood and timing decisions with time-varying covariates, I employ an extended Cox proportional hazard model, which allows for random-effects modeling of predictor variables at the subsidiary, parent MNE, and host country levels. To determine the exit mode of subsidiaries that choose exit over staying, I use binomial logit models. To correct for potential sample selection bias, I replicate my exit mode results with a Heckman probit model. My findings suggest that
increasing strategic flexibility can counterbalance the potential disadvantages associated with leveraging strategically salient resources in high-risk locations.
In examining war as a broad-based perturbation capable of destroying not only institutionalized values, but also the physical infrastructure and human capital of firms, this dissertation empirically demonstrates how political violence influences the strategies of MNEs. Furthermore, my interdisciplinary approach in integrating theoretical lenses from climate change and natural environment sustainability with existing management literatures to examine the effect of war on firms serves to enhance our understanding of individuals and collectives in extreme conditions.
Advisors/Committee Members: Eden, Lorraine (advisor), Hitt, Michael A. (committee member), Zardkoohi, Asghar (committee member), Li, Quan (committee member).
Subjects/Keywords: war; political violence; political instability; discontinuous environments; firm-government/society relations; foreign direct investment; multinational strategy; resource based view; resource management theory; real options theory; interdisciplinary research; foreign exit; emerging economies; survival
to Zotero / EndNote / Reference
APA (6th Edition):
Dai, L. (2012). Caught in the Crossfire: Strategies of Multinationals in Host Countries at War. (Doctoral Dissertation). Texas A&M University. Retrieved from http://hdl.handle.net/1969.1/ETD-TAMU-2011-12-10245
Chicago Manual of Style (16th Edition):
Dai, Li. “Caught in the Crossfire: Strategies of Multinationals in Host Countries at War.” 2012. Doctoral Dissertation, Texas A&M University. Accessed October 21, 2020.
MLA Handbook (7th Edition):
Dai, Li. “Caught in the Crossfire: Strategies of Multinationals in Host Countries at War.” 2012. Web. 21 Oct 2020.
Dai L. Caught in the Crossfire: Strategies of Multinationals in Host Countries at War. [Internet] [Doctoral dissertation]. Texas A&M University; 2012. [cited 2020 Oct 21].
Available from: http://hdl.handle.net/1969.1/ETD-TAMU-2011-12-10245.
Council of Science Editors:
Dai L. Caught in the Crossfire: Strategies of Multinationals in Host Countries at War. [Doctoral Dissertation]. Texas A&M University; 2012. Available from: http://hdl.handle.net/1969.1/ETD-TAMU-2011-12-10245