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Publication: Multinational Business Review
Title: Is the Global Company in Retreat
Type:Journal Special Issue
Editors:Steve Globerman (Western Washington University), Walid Hejazi (University of Toronto)
Deadline:October 20, 2017

Guest Editors:

            Steve Globerman, Western Washington University, Steven.Globerman@wwu.edu

            Walid Hejazi, University of Toronto, Hejazi@Rotman.utoronto.ca

MBR Special Issues: Is the Global Company in Retreat? – Overview

The January 28, 2017 Issue of the Economist featured two articles focusing on the question of whether multinational firms (MNEs) were declining in importance (“The retreat of the global company”). The stories made several empirical points, each of which has been a familiar theme in the IB literature:

  1. MNEs (defined as firms with more that 30% of sales outside their home region) are performing less well than they did in the past relative to more localized competitors.
  2. Share prices of MNEs are falling relative to non-MNEs
  3. Profits of the largest MNEs in the world have declined over the past 5 years, with foreign profits declining most
  4. Returns-on-equity (ROE) of the largest MNEs are falling, and are lower than non-MNEs
  5. Competition in foreign markets is increasing as local firms become more efficient, particularly in emerging markets, and this lowers profitability in those countries
  6. MNEs are divesting assets abroad, and are thereby becoming less multinational
  7. There are differences across industries and countries, but the overall conclusion is that “multinationals are no longer achieving superior performance”.

These issues have been at the heart of the IB literature over the years. There is a significant literature on whether firm performance increases with multinationality; whether MNEs outperform non-MNEs on a variety of measures; whether subsidiaries of MNEs outperform local competitors; whether MNEs are global or regional; and whether emerging market multinationals (EMNEs) are different from developed country multinationals.

The Economist article challenges us to revisit these issues, and ask whether it is true as an empirical matter that MNEs no longer achieve superior performance. We are therefore announcing a special issue of MBR to address these empirical questions.

Some of the following specific questions are meant to be illustrative guides for paper topics. Variations on these questions are certainly welcome:

  1. Has the value of multinationality changed over time, and is it declining?  
  2. Do MNEs outperform non-MNEs, or do the largest MNEs outperform firms in general? Has the relationship changed in recent years?
  3. Do the subsidiaries of MNEs outperform local competitors in specific markets, and, if so, is the advantage being eroded?
  4. Is there a recent tendency for MNEs to reduce and/or consolidate their foreign operations, and if so, does this phenomenon decrease their global presence?
  5. Does the recent performance of MNEs from developed countries differ from the performance of those from developing countries, and in particular from China? 
  6. Have MNEs enjoyed more success in some geographical regions than in others and, if so, why?
  7. Have the regional strategies of MNEs highlighted by Alan Rugman’s work become less successful or less prominent in recent years?

We are seeking empirical contributions that address these questions to be published in a special issue of MBR. Consistent with our commitment to publishing papers that explore current concerns in a timely manner, and consistent with our commitment to publish replication and exploratory studies, we are soliciting papers that are purely empirical in nature, and that build on the existing literature to answer the questions above.

There is an extensive empirical literature from which to draw background on these questions. See, for example,

  1. T. Agmon and D. Lessard (1977), “Investor Recognition of Corporate International Diversification”, Journal of Finance, 32 (4): 1049-1055
  2. H. Berry (2006), “Shareholder Valuation of Foreign Investment and Expansion”, Strategic Management Journal, 27: 1123-1140.
  3. S. Douglas and C. Craig (1983), “Examining Performance of U.S. Multinationals in Foreign Markets”, Journal of International Business Studies, 14 (3): 51-62
  4. L. Games and K. Ramaswamy (1999), “An Empirical Examination of the Form of the Relationship between Multinationality and Performance”, Journal of International Business Studies, 30 (1): 173-188
  5. L. Li (2007), “Multinationality and Performance: A Synthetic Review and Research Agenda”, International Journal of Management Reviews, 9 (2): 117-139
  6. A. Michel and I. Shaked (1986), “Multinational Corporations versus Domestic Corporations: Financial Performance and Characteristics”, Journal of International Business Studies, 17 (3): 89-100
  7. T. Osegowitsch and A. Sammartino (2008), “Reassessing (Home-) Regionalisation”, Journal of International Business Studies 39 (2): 184—196

Submission Details

  •   We are encouraging the submission of relatively short (6000 words) papers that are both concise and rigorous. We are not looking for new theory development but, rather, new evidence that bears upon the issues raised by the Economist.
  •   Submissions should be prepared using the MBR Manuscript Preparation Guidelines.
  •   Manuscripts should be submitted by 20 October 2017 using the MBR website (https://mc.manuscriptcentral.com/tmbr)
  •   Manuscripts will be reviewed according to the MBR double-blind review process.
  •   For informal inquiries related to the Special Issue, proposed topics and potential fit with the Special Issue objectives, please contact the guest editors. 

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