Abstract
In this study, we argue that when undertaking location decisions, multinational enterprises
(MNEs) ought to incorporate their competitors’ reactions to such decisions as well as consumer preferences for location, in addition to the more standard cost-benefit analyses. We view
MNEs as networks of activities connected via product and knowledge flows and develop a
game-theoretic, location-allocation mathematical model. A series of computational analyses
leads to competitive outcomes and location choices, where even without an explicit modeling
of inter-region differences, MNEs show strong tendency toward regionally focused location
configurations. Importantly, such regionally focused location configurations can take the shape
of regionally focused MNEs or of globally dispersed MNEs with regional structures. Copyright
© 2015 Strategic Management Society
(MNEs) ought to incorporate their competitors’ reactions to such decisions as well as consumer preferences for location, in addition to the more standard cost-benefit analyses. We view
MNEs as networks of activities connected via product and knowledge flows and develop a
game-theoretic, location-allocation mathematical model. A series of computational analyses
leads to competitive outcomes and location choices, where even without an explicit modeling
of inter-region differences, MNEs show strong tendency toward regionally focused location
configurations. Importantly, such regionally focused location configurations can take the shape
of regionally focused MNEs or of globally dispersed MNEs with regional structures. Copyright
© 2015 Strategic Management Society
| Original language | English |
|---|---|
| Pages (from-to) | 278-302 |
| Number of pages | 5 |
| Journal | Global Strategy Journal |
| Volume | 5 |
| Issue number | 4 |
| DOIs | |
| Publication status | Published - 23 Nov 2015 |
Keywords
- multinational enterprise
- location decision
- competition
- consumer preferences
- regional MNEs
- discrete choice modeling