Abstract
Asian foreign direct investment is substantial in Hungary in regional comparison. Multinationals from China, India, Japan, and Korea are important investors in the Hungarian economy. The main aim of this article is to describe how home and host country institutions and business and management culture influence the operation of the companies in question, first of all in the various areas of human resource management. In the analysis, we rely mainly on the Varieties-of-Capitalism approach, given its emphasis on the organizational and related cultural differences that result in different types of capitalisms in the world economy. The article is based on company interviews conducted with the representatives of seven Asian subsidiaries in Hungary (1–10 interviews per company) that are operational in the automotive and/or electronics industry. Our conclusion is that management and labor relations in these companies evolve under the influence and through the interaction of related home and host country business culture, thus they contain elements of both. However, we found the clear dominance of host country impacts, which has become more pronounced over time.
Highlights
Asian foreign direct investment (FDI) is substantial in Hungary in regional comparison
Only Japanese capitalism can be integrated into the Varieties of Capitalism (VoC) approach
As the authors state: ‘the Varieties of Capitalism (VOC) dichotomy is not applicable to Asia; [...] none of the existing major frameworks capture all Asian types of capitalism; and [...] Asian business systems cannot be understood through categories identified in the West’ (Witt and Redding, 2013: 265)
Summary
Asian foreign direct investment (FDI) is substantial in Hungary in regional comparison. The general and business culture and modus operandi of Asian firms differ considerably from those of European and East Central European ones These differences may cause problems in the everyday operation of subsidiaries (Adler and Graham, 1989) if they are not handled and taken into account at an early stage of investment. We analyze whether home or host country practices dominate in the areas of industrial relations, employee relations, and vocational training in selected Asian subsidiaries in Hungary. Selection of these areas is based on data availability. The latest BPM6 FDI data are available for Hungary for 2016, and here are presented broken down according to ultimate investment and direct investment (Table 1).
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