The International Scale and Scope of European Multinationals

Abstract:     
This study analyzes the international scale and scope of European multinational enterprises (MNEs). By using five widely used multinationality measures and the corresponding five measures for intra-regional activities, the results confirm that the European MNEs focus on their home region market rather than the global market. No evidence exists that European MNEs focus on global markets or becoming geographically diversified during 2000-2006. Additionally, this study suggests that scales and entropy measures, which are based on sales and assets, are better than scope measures, which are based on country counts. Simple country and subsidiary counts wrongly guide researchers to conclude that the MNEs are more dispersed than they really are.

Number of Pages in PDF File: 24

Keywords: multinationality, regional activities, scale measure, scope measure, entropy measure, European firm

JEL Classification: F23

working papers series