1. What is “Chinese” About Chinese Multinationals?
Ravi Ramamurti
University Distinguished Professor and Director, Center for Emerging Markets
Northeastern University
CBS Conference on Emerging Multinationals
Copenhagen Business School
October 12, 2018

3. Does MNC’s Nationality Matter?
“The multinationalizing trend [is] widely recognized as similar in nature irrespective of the nationality of the parent company.” --Raymond Vernon (quoted in Wilkins, (1986)

4. Answer: Yes, but…
“Nationality” matters, but it is analytically useless
Nationality stands for so many things that it stands for nothing
Better to ask why a firm behaves as it does, and look for partial explanations that can contribute towards a larger, universal theory of internationalization

5. “China may be unique, but aspects of Chinese MNE behavior may be explainable with concepts that have universal relevance. The goal of theory building is precisely to identify such concepts”
(Ramamurti & Hillemann, JIBS,2018, p. 35)

6. 1. Stage of Evolution as an MNE
Affects extent of dependence on home market and home CSAs
Strength of FSAs, e.g. brands
Extent of tapping into other countries’ CSAs
Location boundedness of FSAs
Ratio of exports to foreign production
Geographic footprint

8. Extent of Internationalization, DMNEs and EMNEs
Source: Ramamurti & Hillemann, JIBS, 2018

9. 2. Global Context for Internationalization
“Gateways to internationalization” (Williamson & Zeng, 2009) “the rise of outsourcing, the modularization of global value chains, the codification of knowledge, the gradual concentration and globalization of retailing, the more fluid international market for talent and professional services, and the increasingly open market for corporate control in many countries.”
The context can change dramatically, e.g. before Great Depression, after WW2, and perhaps now (“de-globalization”) IB models should not ignore period effects of this kind
Be careful comparing firms in different time periods

10. 3. Government-Created Advantages
Peng (2012) notes that home government may not be important for DMNCs but they are for Chinese MNCs
Government is not just another institution. It creates other institutions, including SOEs.
And govt creates the national and international context for macroeconomic growth, human capital, physical infrastructure, R&D, and defines microeconomic policies (e.g. industrial targeting)
Chinese government is a co-driver of firms’ strategies
CSAs are the result of GCAs interacting and co-evolving with natural endowments

11. Roots of CSAs Natural Endowments GCAs
Land, labor, natural resources, climate, location
GCAs
Macroeconomic strategy, SOEs, infrastructure and human capital investments, and targeting
Country-Specific Advantages (CSAs)
Source: Ramamurti 2013 in Williamson et al, The competitive advantage of EMNEs (Cambridge U Press

12. Conclusions
The reason to ask if nationality matters is to uncover explanations that diminish the value of asking that question
Aim is to uncover universal explanations that can improve our theories of how firms internationalize
GCA is the most important variable that comes out of Chinese experience, because it critically shapes China’s CSAs
Government is not just another institution; it shapes much else in a country; not helpful to lump government into “institutions”
Every country is unique, but that doesn’t mean we need a unique theory of internationalization for every country

13. Thank you