MNC Subsidiary Embeddedness in the Host Country An Integrated Conceptual Framework

Abstract

It is widely acknowledged in international business (IB) studies that a host country can play a critical role in the strategic development of MNC subsidiaries. This study departs from the traditional embeddedness concept, which expresses the relationships between MNCs and the national context of host countries, and develops an integrative framework based on four different approaches: the transaction cost and internationalization approach; the resource-based view and micro-political approach; the network paradigm; and the approach of economic geographers. This integrative framework may be used in future research to provide a deeper analysis of the relationship between the multinationals and the local host milieu.