Comments On: Japanese Multinationals in Europe and the United States: Some Comparisons and Contrasts

Abstract

The theme of the Dunning/Gittelman paper can be summarized as follows: The competitive advantages of Japanese corporations (O-advantages) in the global market have been built largely within the confines of their national environment (L-advantages at home). Their overseas investments so far have been either of the resource-seeking or of the market-seeking type, all intended to support the continuous upgrading of their export industries. In other words, their competitive base has long been confined to their own economy; exporting has been the main vehicle of exploiting their O-advantages. Yet the very success of Japan’s economic development and the sharp appreciation of the yen are now changing Japan’s industrial landscape. To protect existing share in their export markets, particularly, in the United States and Europe where trade friction is frequent, Japan’s star export industries, notably automobiles, electronics goods, and machinery, are forced to transplant their manufacturing systems overseas.