International Business Strategy Papers
Overview of Key Papers in International Strategy
This collection summarizes foundational and contemporary papers in international strategy, exploring why and how firms expand
across borders. The papers cover a wide range of topics, including the core motivations for internationalization, the influence of
home and host country environments, the complexities of culture and institutional distance, and the strategic management of
global networks and corporate social responsibility.
1. Benito (2015): This paper reinforces the fundamental relevance of Dunning's four motives (market-, efficiency-,
resource-, and asset-seeking), demonstrating how each systematically predicts different choices regarding a firm's
international location, governance, and performance metrics.
2. Grant (1991): This article provides a foundational assessment of Porter's "National Diamond," praising its dynamic, firm-
level view of international competitiveness while critiquing its lack of precision and weak predictive power.
3. Guler & Guillén (2010): Using a large sample of US venture capital firms, this study shows that the choice of foreign
market is driven by host-country institutional quality (e.g., innovation systems, investor protection) and that
international experience helps firms overcome these institutional voids.
4. Beugelsdijk & Welzel (2018): This paper synthesizes the cultural frameworks of Hofstede and Inglehart, finding that
while national cultures have become more individualistic and joyous over time, their relative rankings remain
remarkably stable due to deep-rooted, country-specific historical factors.
5. Zhou & Guillén (2016): This study bridges the literatures on Liability of Foreignness (LoF) and distance by creating a new
typology based on the OLI paradigm, showing that the specific type of LoF a firm faces is contingent on its motivation for
FDI.
6. Schellenberg et al. (2018): This systematic literature review critically evaluates the five main theories of market entry
mode choice and identifies key gaps in the literature, namely the lack of focus on SMEs, decision-making processes, and
theoretical integration.
7. Hollender et al. (2017): Focusing on SMEs, this research demonstrates that the performance of a chosen entry mode is
contingent on the firm’s resources and capabilities, showing that low-commitment modes can outperform high-
commitment modes if supported by international experience and product adaptation.
8. Oviatt & McDougall (2005): This paper provides a new, opportunity-centric definition of international entrepreneurship
and proposes a comprehensive model to explain the speed of internationalization, offering a theoretical foundation for
the "born global" phenomenon.
9. Birkinshaw & Hood (1998): This article develops a dynamic model of subsidiary evolution, defining it as the interplay
between capability development and charter change and identifying five generic processes through which subsidiary
roles change over time.
10. Le Bas & Sierra (2002): Using European patent data, this study finds that MNEs predominantly locate R&D abroad in
fields where they are already strong at home, with a growing trend toward "home-base-augmenting" strategies that
build on core strengths in foreign centers of excellence.
11. Mudambi & Venzin (2010): This paper conceptualizes offshoring (location) and outsourcing (control) as a "strategic
nexus," arguing that these interdependent decisions must be analyzed at the activity level to effectively orchestrate a
global value chain.
12. Kedia & Mukherjee (2009): This study proposes the Disintegration-Location-Externalization (DLE) framework to explain
why firms offshore, arguing that the decision is driven by a combination of firm-level, country-level, and inter-firm
advantages.
13. Hernandez & Guillén (2018): This commentary argues that the EMNE research agenda should move beyond simple
comparisons with DMNEs and instead use the unique context of emerging markets to study the fundamental origins of
MNE capabilities and their supporting institutional ecosystems.
14. Bondy & Starkey (2014): This paper critically examines the "integrated" internationalization strategy through the lens of
CSR, finding that it functions as a rebranded global strategy that systematically marginalizes local host-country issues in
favor of home-country-defined "universal" standards.
15. Aguilera & Jackson (2010): This comprehensive review organizes the fragmented literature on comparative corporate
governance into four theoretical paradigms (economic, cultural, legal, political) and calls for an integrated, historical,
and actor-centered research agenda.
16. Hooker (2009): This article provides a culturally sensitive definition of corruption as behavior that undermines the local
cultural system, arguing that practices like nepotism can be functional in relationship-based cultures while Western
norms like lawsuits can be corrupting.
,Contents
1. BENITO (2015). WHY AND HOW MOTIVES (STILL) MATTER....................................................................4
2. GRANT (1991). PORTER’S ‘COMPETITIVE ADVANTAGE OF NATIONS’: AN ASSESSMENT..........................5
3. GULER & GUILLÉN (2010). INSTITUTIONS AND THE INTERNATIONALIZATION OF US VENTURE CAPITAL
FIRMS.......................................................................................................................................................6
4. BEUGELSDIJK & WELZEL (2018). DIMENSIONS AND DYNAMICS OF NATIONAL CULTURE: SYNTHESIZING
HOFSTEDE WITH INGLEHART.....................................................................................................................7
5. ZHOU & GUILLEN (2016). CATEGORIZING THE LIABILITY OF FOREIGNNESS: OWNERSHIP, LOCATION,
AND INTERNALIZATION-SPECIFIC DIMENSIONS.........................................................................................8
6. SCHELLENBERG ET AL (2018). INTERNATIONAL MARKET ENTRY MODE - A SYSTEMATIC LITERATURE
REVIEW.....................................................................................................................................................9
7. HOLLENDER ET AL (2017). SME FOREIGN MARKET ENTRY MODE CHOICE AND FOREIGN VENTURE
PERFORMANCE: THE MODERATING EFFECT OF INTERNATIONAL EXPERIENCE AND PRODUCT
ADAPTATION...........................................................................................................................................10
8. OVIATT ET AL. (2005). DEFINING INTERNATIONAL ENTREPRENEURSHIP AND MODELING THE SPEED OF
INTERNATIONALIZATION.........................................................................................................................11
9. BIRKINSHAW & HOOD (1998). “MULTINATIONAL SUBSIDIARY EVOLUTION: CAPABILITY AND CHARTER
CHANGE IN FOREIGN-OWNED SUBSIDIARY COMPANIES.”.......................................................................12
10. LE BAS & SIERRA (2002). ‘LOCATION VERSUS HOME COUNTRY ADVANTAGES’ IN R&D ACTIVITIES:
SOME FURTHER RESULTS ON MULTINATIONALS’ LOCATIONAL STRATEGIES.............................................13
11. MUDAMBI & VENZIN (2010). THE STRATEGIC NEXUS OF OFFSHORING AND OUTSOURCING DECISIONS.
...............................................................................................................................................................14
12. KEDIA & MUKHERJEE (2009). UNDERSTANDING OFFSHORING: A RESEARCH FRAMEWORK BASED ON
DISINTEGRATION, LOCATION AND EXTERNALIZATION ADVANTAGES........................................................15
13. HERNANDEZ & GUILLÉN (2018). WHAT’S THEORETICALLY NOVEL ABOUT EMERGING-MARKET
MULTINATIONALS?..................................................................................................................................17
14. BONDY & STARKEY (2014). THE DILEMMAS OF INTERNATIONALIZATION: CORPORATE SOCIAL
RESPONSIBILITY IN THE MULTINATIONAL CORPORATION........................................................................18
15. AGUILERA & JACKSON (2010). COMPARATIVE AND INTERNATIONAL CORPORATE GOVERNANCE.......19
16. HOOKER (2009). CORRUPTION FROM A CROSS‐CULTURAL PERSPECTIVE...........................................20
, Overall Summary
The Global Quest for Value and Legitimacy
The journey into international strategy is a defining challenge, forcing firms to navigate a complex global landscape where
competition, governance, and ethics vary dramatically. Success hinges on managing the tension between global integration and
local responsiveness. This collection of papers maps this journey, from the initial motives for crossing borders to orchestrating a
global network and dealing with deep-seated institutional complexities.
The Decision to Go Global: Why and Where
A firm's international journey begins with a clear motive, whether seeking new markets, greater efficiency, critical resources, or
strategic assets (Benito, 2015). This "why" shapes all subsequent choices. The "where" is heavily influenced by home and host
country environments. A firm’s competitive advantage often originates in its home country's "national diamond"—a system of
factor conditions, local demand, related industries, and intense rivalry that fosters innovation (Grant, 1991).
When selecting a host country, firms navigate a complex institutional landscape. The quality of a host's institutions—from its
innovation systems to legal protections—is a powerful magnet for foreign investment, especially for knowledge-intensive firms
(Guler & Guillén, 2010). However, crossing borders introduces the Liability of Foreignness, a set of costs from the "distance"
between nations. These liabilities are not monolithic; their importance varies with the firm's strategic motivation (Zhou &
Guillén, 2016). Understanding this distance requires appreciating national cultures. While absolute cultural values are changing,
the relative cultural distance between countries remains stable, making culture a persistent factor in strategy (Beugelsdijk &
Welzel, 2018).
Crafting the International Footprint: How and How Fast
Once the decision to internationalize is made, firms must choose how to enter a foreign market. This entry mode decision is a
key strategic issue explained by theories like the transaction cost approach, the resource-based view, and institutional theory
(Schellenberg et al., 2018). For SMEs, there is no single best mode; performance depends on the fit between the mode and the
firm's internal capabilities. Low-commitment modes can outperform high-commitment ones if the firm has strong international
experience and product adaptation skills (Hollender et al., 2017).
The pace of expansion has also changed. While traditional models show internationalization as a slow process, "born global"
firms require a new explanation. The speed of internationalization is now seen as a dynamic interplay of technology,
competition, entrepreneurial perceptions, and the firm's own knowledge and networks (Oviatt & McDougall, 2005).
Orchestrating the Global Network: Managing Across Borders
An international presence is an evolving network. Subsidiaries are not passive; they undergo a dynamic subsidiary evolution,
driven by the interplay between their capability development and their "charter" within the MNE (Birkinshaw & Hood, 1998).
This can be driven top-down by the parent or emerge bottom-up from the subsidiary's initiatives.
The placement of key activities like R&D is crucial. MNEs increasingly follow a home-base-augmenting strategy, using their
strengths to learn from other global centers of excellence (Le Bas & Sierra, 2002). This reflects a broader trend of value chain
disaggregation, where firms analyze the strategic nexus of offshoring (location) and outsourcing (control) at the activity level
(Mudambi & Venzin, 2010), driven by a combination of disintegration, location, and externalization advantages (Kedia &
Mukherjee, 2009).
Navigating Cross-Border Complexities: Institutions, Ethics, and Strategy
Success in the global arena requires appreciating the profound differences in societies' institutional and ethical fabric. The rise of
Emerging-Market MNEs (EMNEs) offers a unique chance to study the origins of MNE capabilities and their supporting
ecosystems (Hernandez & Guillén, 2018).
Corporate governance and business ethics are not universal. National governance systems are embedded in distinct paradigms,
so there is no single "best practice" model (Aguilera & Jackson, 2010). Similarly, concepts like corruption are culturally
contingent; what is corrupt in a rule-based Western culture may be functional in a relationship-based one (Hooker, 2009). Even
the "integrated" strategy faces challenges. In CSR, an "integrated" approach can default to a home-country-centric strategy,
marginalizing local issues under the guise of "universal" values (Bondy & Starkey, 2014).
In conclusion, a successful international strategy requires managing the tensions between global scale and local adaptation,
building a global network of capabilities, and navigating the deep-seated institutional and cultural differences that define our
world.
Overview of Key Papers in International Strategy
This collection summarizes foundational and contemporary papers in international strategy, exploring why and how firms expand
across borders. The papers cover a wide range of topics, including the core motivations for internationalization, the influence of
home and host country environments, the complexities of culture and institutional distance, and the strategic management of
global networks and corporate social responsibility.
1. Benito (2015): This paper reinforces the fundamental relevance of Dunning's four motives (market-, efficiency-,
resource-, and asset-seeking), demonstrating how each systematically predicts different choices regarding a firm's
international location, governance, and performance metrics.
2. Grant (1991): This article provides a foundational assessment of Porter's "National Diamond," praising its dynamic, firm-
level view of international competitiveness while critiquing its lack of precision and weak predictive power.
3. Guler & Guillén (2010): Using a large sample of US venture capital firms, this study shows that the choice of foreign
market is driven by host-country institutional quality (e.g., innovation systems, investor protection) and that
international experience helps firms overcome these institutional voids.
4. Beugelsdijk & Welzel (2018): This paper synthesizes the cultural frameworks of Hofstede and Inglehart, finding that
while national cultures have become more individualistic and joyous over time, their relative rankings remain
remarkably stable due to deep-rooted, country-specific historical factors.
5. Zhou & Guillén (2016): This study bridges the literatures on Liability of Foreignness (LoF) and distance by creating a new
typology based on the OLI paradigm, showing that the specific type of LoF a firm faces is contingent on its motivation for
FDI.
6. Schellenberg et al. (2018): This systematic literature review critically evaluates the five main theories of market entry
mode choice and identifies key gaps in the literature, namely the lack of focus on SMEs, decision-making processes, and
theoretical integration.
7. Hollender et al. (2017): Focusing on SMEs, this research demonstrates that the performance of a chosen entry mode is
contingent on the firm’s resources and capabilities, showing that low-commitment modes can outperform high-
commitment modes if supported by international experience and product adaptation.
8. Oviatt & McDougall (2005): This paper provides a new, opportunity-centric definition of international entrepreneurship
and proposes a comprehensive model to explain the speed of internationalization, offering a theoretical foundation for
the "born global" phenomenon.
9. Birkinshaw & Hood (1998): This article develops a dynamic model of subsidiary evolution, defining it as the interplay
between capability development and charter change and identifying five generic processes through which subsidiary
roles change over time.
10. Le Bas & Sierra (2002): Using European patent data, this study finds that MNEs predominantly locate R&D abroad in
fields where they are already strong at home, with a growing trend toward "home-base-augmenting" strategies that
build on core strengths in foreign centers of excellence.
11. Mudambi & Venzin (2010): This paper conceptualizes offshoring (location) and outsourcing (control) as a "strategic
nexus," arguing that these interdependent decisions must be analyzed at the activity level to effectively orchestrate a
global value chain.
12. Kedia & Mukherjee (2009): This study proposes the Disintegration-Location-Externalization (DLE) framework to explain
why firms offshore, arguing that the decision is driven by a combination of firm-level, country-level, and inter-firm
advantages.
13. Hernandez & Guillén (2018): This commentary argues that the EMNE research agenda should move beyond simple
comparisons with DMNEs and instead use the unique context of emerging markets to study the fundamental origins of
MNE capabilities and their supporting institutional ecosystems.
14. Bondy & Starkey (2014): This paper critically examines the "integrated" internationalization strategy through the lens of
CSR, finding that it functions as a rebranded global strategy that systematically marginalizes local host-country issues in
favor of home-country-defined "universal" standards.
15. Aguilera & Jackson (2010): This comprehensive review organizes the fragmented literature on comparative corporate
governance into four theoretical paradigms (economic, cultural, legal, political) and calls for an integrated, historical,
and actor-centered research agenda.
16. Hooker (2009): This article provides a culturally sensitive definition of corruption as behavior that undermines the local
cultural system, arguing that practices like nepotism can be functional in relationship-based cultures while Western
norms like lawsuits can be corrupting.
,Contents
1. BENITO (2015). WHY AND HOW MOTIVES (STILL) MATTER....................................................................4
2. GRANT (1991). PORTER’S ‘COMPETITIVE ADVANTAGE OF NATIONS’: AN ASSESSMENT..........................5
3. GULER & GUILLÉN (2010). INSTITUTIONS AND THE INTERNATIONALIZATION OF US VENTURE CAPITAL
FIRMS.......................................................................................................................................................6
4. BEUGELSDIJK & WELZEL (2018). DIMENSIONS AND DYNAMICS OF NATIONAL CULTURE: SYNTHESIZING
HOFSTEDE WITH INGLEHART.....................................................................................................................7
5. ZHOU & GUILLEN (2016). CATEGORIZING THE LIABILITY OF FOREIGNNESS: OWNERSHIP, LOCATION,
AND INTERNALIZATION-SPECIFIC DIMENSIONS.........................................................................................8
6. SCHELLENBERG ET AL (2018). INTERNATIONAL MARKET ENTRY MODE - A SYSTEMATIC LITERATURE
REVIEW.....................................................................................................................................................9
7. HOLLENDER ET AL (2017). SME FOREIGN MARKET ENTRY MODE CHOICE AND FOREIGN VENTURE
PERFORMANCE: THE MODERATING EFFECT OF INTERNATIONAL EXPERIENCE AND PRODUCT
ADAPTATION...........................................................................................................................................10
8. OVIATT ET AL. (2005). DEFINING INTERNATIONAL ENTREPRENEURSHIP AND MODELING THE SPEED OF
INTERNATIONALIZATION.........................................................................................................................11
9. BIRKINSHAW & HOOD (1998). “MULTINATIONAL SUBSIDIARY EVOLUTION: CAPABILITY AND CHARTER
CHANGE IN FOREIGN-OWNED SUBSIDIARY COMPANIES.”.......................................................................12
10. LE BAS & SIERRA (2002). ‘LOCATION VERSUS HOME COUNTRY ADVANTAGES’ IN R&D ACTIVITIES:
SOME FURTHER RESULTS ON MULTINATIONALS’ LOCATIONAL STRATEGIES.............................................13
11. MUDAMBI & VENZIN (2010). THE STRATEGIC NEXUS OF OFFSHORING AND OUTSOURCING DECISIONS.
...............................................................................................................................................................14
12. KEDIA & MUKHERJEE (2009). UNDERSTANDING OFFSHORING: A RESEARCH FRAMEWORK BASED ON
DISINTEGRATION, LOCATION AND EXTERNALIZATION ADVANTAGES........................................................15
13. HERNANDEZ & GUILLÉN (2018). WHAT’S THEORETICALLY NOVEL ABOUT EMERGING-MARKET
MULTINATIONALS?..................................................................................................................................17
14. BONDY & STARKEY (2014). THE DILEMMAS OF INTERNATIONALIZATION: CORPORATE SOCIAL
RESPONSIBILITY IN THE MULTINATIONAL CORPORATION........................................................................18
15. AGUILERA & JACKSON (2010). COMPARATIVE AND INTERNATIONAL CORPORATE GOVERNANCE.......19
16. HOOKER (2009). CORRUPTION FROM A CROSS‐CULTURAL PERSPECTIVE...........................................20
, Overall Summary
The Global Quest for Value and Legitimacy
The journey into international strategy is a defining challenge, forcing firms to navigate a complex global landscape where
competition, governance, and ethics vary dramatically. Success hinges on managing the tension between global integration and
local responsiveness. This collection of papers maps this journey, from the initial motives for crossing borders to orchestrating a
global network and dealing with deep-seated institutional complexities.
The Decision to Go Global: Why and Where
A firm's international journey begins with a clear motive, whether seeking new markets, greater efficiency, critical resources, or
strategic assets (Benito, 2015). This "why" shapes all subsequent choices. The "where" is heavily influenced by home and host
country environments. A firm’s competitive advantage often originates in its home country's "national diamond"—a system of
factor conditions, local demand, related industries, and intense rivalry that fosters innovation (Grant, 1991).
When selecting a host country, firms navigate a complex institutional landscape. The quality of a host's institutions—from its
innovation systems to legal protections—is a powerful magnet for foreign investment, especially for knowledge-intensive firms
(Guler & Guillén, 2010). However, crossing borders introduces the Liability of Foreignness, a set of costs from the "distance"
between nations. These liabilities are not monolithic; their importance varies with the firm's strategic motivation (Zhou &
Guillén, 2016). Understanding this distance requires appreciating national cultures. While absolute cultural values are changing,
the relative cultural distance between countries remains stable, making culture a persistent factor in strategy (Beugelsdijk &
Welzel, 2018).
Crafting the International Footprint: How and How Fast
Once the decision to internationalize is made, firms must choose how to enter a foreign market. This entry mode decision is a
key strategic issue explained by theories like the transaction cost approach, the resource-based view, and institutional theory
(Schellenberg et al., 2018). For SMEs, there is no single best mode; performance depends on the fit between the mode and the
firm's internal capabilities. Low-commitment modes can outperform high-commitment ones if the firm has strong international
experience and product adaptation skills (Hollender et al., 2017).
The pace of expansion has also changed. While traditional models show internationalization as a slow process, "born global"
firms require a new explanation. The speed of internationalization is now seen as a dynamic interplay of technology,
competition, entrepreneurial perceptions, and the firm's own knowledge and networks (Oviatt & McDougall, 2005).
Orchestrating the Global Network: Managing Across Borders
An international presence is an evolving network. Subsidiaries are not passive; they undergo a dynamic subsidiary evolution,
driven by the interplay between their capability development and their "charter" within the MNE (Birkinshaw & Hood, 1998).
This can be driven top-down by the parent or emerge bottom-up from the subsidiary's initiatives.
The placement of key activities like R&D is crucial. MNEs increasingly follow a home-base-augmenting strategy, using their
strengths to learn from other global centers of excellence (Le Bas & Sierra, 2002). This reflects a broader trend of value chain
disaggregation, where firms analyze the strategic nexus of offshoring (location) and outsourcing (control) at the activity level
(Mudambi & Venzin, 2010), driven by a combination of disintegration, location, and externalization advantages (Kedia &
Mukherjee, 2009).
Navigating Cross-Border Complexities: Institutions, Ethics, and Strategy
Success in the global arena requires appreciating the profound differences in societies' institutional and ethical fabric. The rise of
Emerging-Market MNEs (EMNEs) offers a unique chance to study the origins of MNE capabilities and their supporting
ecosystems (Hernandez & Guillén, 2018).
Corporate governance and business ethics are not universal. National governance systems are embedded in distinct paradigms,
so there is no single "best practice" model (Aguilera & Jackson, 2010). Similarly, concepts like corruption are culturally
contingent; what is corrupt in a rule-based Western culture may be functional in a relationship-based one (Hooker, 2009). Even
the "integrated" strategy faces challenges. In CSR, an "integrated" approach can default to a home-country-centric strategy,
marginalizing local issues under the guise of "universal" values (Bondy & Starkey, 2014).
In conclusion, a successful international strategy requires managing the tensions between global scale and local adaptation,
building a global network of capabilities, and navigating the deep-seated institutional and cultural differences that define our
world.
