Abstract
Purpose Using an institution-based view, this study aims to conceptualize how sub-national institutional characteristics are likely to explain location choice of multinationals’ research and development (R&D) subsidiaries. Design/methodology/approach In a conceptual paper, this study explores specific institutional facets of the regional environments within a country that are capable of explaining, at least in part, the location choices of multinational corporations’ R&D subsidiaries. Findings This study thus explores the more nuanced influences of the institutional environments at a subnational level and develops propositions to explain location choices based on the differences of the institutional environments. Originality/value This study contributes to international business theory by incorporating a location-specific analysis that contrasts to the usual country-level observation on the determinants of firms’ location decisions.
Highlights
Research on innovation-driven multinational corporations (MNCs) has gained increasing significance in international business studies (Cano-Kollmann, Cantwell, Hannigan, Mudambi, & Song, 2016)
We propose that by bringing together what we know about the national variations with additional knowledge on how the subnational idiosyncrasies matter, we come closer to understand how firms can leverage or augment their innovation capabilities across heterogeneous spaces
We have delved into the location of research and development (R&D) subsidiaries albeit similar reasoning could be used to enquire into the location of other types of subsidiaries
Summary
Graduate School of Management (PPGAd), Universidade Regional de Blumenau (FURB), Blumenau, Brazil, and Manuel Portugal Ferreira.
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