Abstract
The evolutionary theory of the multinational enterprise (MNE) views the MNE as an instrument for generating and transferring knowledge. A multinational firm’s ability and incentive to transfer knowledge effectively and efficiently is the main reason for its global footprint. Internal knowledge transfers work better than transfers between firms because of the lower resource costs and greater control over trade secrets of transmitting knowledge internally versus across a market. In evolutionary theory, transaction cost or contractual difficulties are not the main reasons why firms become multinational. Evolutionary theory has influenced the knowledge-based and capability theories of the MNE in which the MNE is viewed as a repository of knowledge and resources rather than a nexus of contracts.
This is a preview of subscription content, log in via an institution to check access.
References
Alchian, A.A. 1953. Biological analogies in the theory of the firm: Comment. American Economic Review 43: 600–603.
Augier, M., and D.J. Teece. 2008. Strategy as evolution with design: The foundations of dynamic capabilities and the role of managers in the economic system. Organization Studies 29: 1187–1208.
Buckley, P., and M. Casson. 1976. The future of the multinational enterprise. London: Macmillan.
Cohen, W.M., and D. Levinthal. 1990. Absorptive capacity: A new perspective on learning and innovation. Administrative Science Quarterly 35: 128–152.
Cyert, K., and J. March. 1963. A behavioral theory of the firm. Englewood Cliffs: Prentice Hall.
Dhanaraj, C., M. Lyles, H. Steensma, and L. Tihanyi. 2004. Managing tacit and explicit knowledge transfer in international joint ventures: The role of relational embeddedness and the impact on performance. Journal of International Business Studies 35: 428–442.
Dunning, J.H. 2001. The key literature on IB activities: 1960–2000. In The Oxford handbook of international business, ed. A.M. Rugman and T.L. Brewer. Oxford: Oxford University Press.
Kogut, B. 1997. The evolutionary theory of the multinational corporation: Within and across-country options. In International business: An emerging vision, ed. B. Toyne and D. Nigh. Columbia: University of South Carolina Press.
Kogut, B., and U. Zander. 1993. Knowledge of the firm and the evolutionary theory of the multinational corporation. Journal of International Business Studies 24: 625–646.
Kogut, B. and Zander, U. 1995. Knowledge, market failure and the multinational enterprise: A reply. Journal of International Business Studies 2: 417–426.
Martin, X., and R. Salomon. 2003. Knowledge transfer capacity and its implications for the theory of the multinational corporation. Journal of International Business Studies 34: 356–373.
Nelson, R., and S. Winter. 1982. An evolutionary theory of economic change. Cambridge, MA: Harvard University Press.
Rugman, A.M. 1980. Internalization as a general theory of foreign direct investment: A re-appraisal of the literature. Weltwirtschaftliches Archiv 116: 365–379.
Rugman, A. M. 1981. Inside the multinationals: The economics of internal markets. London: Croom Helm.
Subramaniam, M., and N. Venkatraman. 2001. Determinants of transnational new product development capability: Testing the influence of transferring and deploying tacit overseas knowledge. Strategic Management Journal 22: 359–378.
Szulanski, G. 1996. Exploring internal stickiness: Impediments to the transfer of best practice within the firm. Strategic Management Journal 17: 27–43.
Teece, D.J. 1976. The multinational corporation and the resource cost of international technology transfer. Cambridge, MA: Ballinger Publishing.
Teece, D. J. 1977. Technology transfer by multinational firms: The resource cost of transferring technological know-how. Economic Journal 87: 242–261.
Teece, D. J. 1981. The multinational enterprise: Market failure and market power considerations. Sloan Management Review 22: 3–17.
Teece, D. J. 1986. Profiting from technological innovation. Research Policy 15: 285–305.
Teece, D. J. 2014. A dynamic capabilities-based entrepreneurial theory of the multinational enterprise. Journal of International Business Studies 45: 8–37.
Teece, D.J., R. Rumelt, G. Dosi, and S. Winter. 1994. Understanding corporate coherence: Theory and evidence. Journal of Economic Behavior & Organization 23: 1–30.
Winter, S. 1975. Optimization and evolution in the theory of the firm. In Adaptive economic models, ed. R. Day and T. Groves. New York: Academic Press.
Winter, S. 1987. Knowledge and competence as strategic assets. In The competitive challenge, ed. D. J. Teece. Cambridge, MA: Ballinger.
Zander, U., and B. Kogut. 1995. Knowledge and the speed of the transfer and imitation of organizational capabilities: An empirical test. Organization Science 6: 76–92.
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Copyright information
© 2017 The Author(s)
About this entry
Cite this entry
Leih, S. (2017). Evolutionary Theory of the Multinational Corporation. In: Augier, M., Teece, D. (eds) The Palgrave Encyclopedia of Strategic Management. Palgrave Macmillan, London. https://doi.org/10.1057/978-1-349-94848-2_89-1
Download citation
DOI: https://doi.org/10.1057/978-1-349-94848-2_89-1
Received:
Accepted:
Published:
Publisher Name: Palgrave Macmillan, London
Online ISBN: 978-1-349-94848-2
eBook Packages: Springer Reference Business and ManagementReference Module Humanities and Social SciencesReference Module Business, Economics and Social Sciences