Evolutionary View of International Production Fragmentation in Enterprises

Abstract

A trend parallel to the growing importance of international production fragmentation has also been the growing share of emerging economies in international trade and foreign direct investment. Initially, these countries participated in international production fragmentation as a location for various parts of the global value chains of foreign companies. With time, however, many companies originating from these countries — including the BRIC (Brazil, Russia, India, China) and Central and Eastern European countries — started to internationalize (see Chittoor and Ray, 2007; Sirkin et al., 2008; Gammeltoft et al., 2010; Radło and Sass, 2012, Radło, 2012). As a result of this phenomenon, one can observe a growing number of emerging multinationals originating from these countries. This phenomenon poses a new question about international production fragmentation in emerging multinationals, and a broader one about the role of production fragmentation at various stages of internationalization.