Download this Paper Open PDF in Browser

Parenting Advantage in the MNC: An Embeddedness Perspective on the Value Added by Headquarters

Strategic Management Journal, Forthcoming

41 Pages Posted: 3 May 2012 Last revised: 23 Apr 2014

Phillip C. Nell

Vienna University of Economics and Business - Department of Global Business and Trade; Copenhagen Business School - Department of Strategic Management and Globalization

Björn Ambos

University of St. Gallen - Institute of Technology Management; Vienna University of Economics and Business

Date Written: March 25, 2013

Abstract

What determines the value an MNC’s headquarters adds to its own affiliates? In this paper, we shed light on this question by linking the embeddedness view of the multinational corporation to the literature on parenting advantage. We test our hypotheses on an original dataset of 124 manufacturing subsidiaries located in Europe. Our results indicate that the external embeddedness of the MNC is an antecedent to headquarters’ value creation. We find that headquarters’ investments into their own relationships with the subsidiaries’ contexts are positively related to the value added by headquarters. Furthermore, this relationship is stronger when the subsidiary itself is strongly embedded. We discuss implications for the MNC literature, embeddedness research, and the literature on parenting and headquarters’ roles.

Keywords: local linkages, embeddedness, parent value added, parenting, headquarters-subsidiary relationships

JEL Classification: M00, M10, L22

Suggested Citation

Nell, Phillip C. and Ambos, Björn, Parenting Advantage in the MNC: An Embeddedness Perspective on the Value Added by Headquarters (March 25, 2013). Strategic Management Journal, Forthcoming. Available at SSRN: https://ssrn.com/abstract=2050359 or http://dx.doi.org/10.2139/ssrn.2050359

Phillip C. Nell (Contact Author)

Vienna University of Economics and Business - Department of Global Business and Trade ( email )

Welthandelsplatz 1
Building D1
Vienna, 1020
Austria

Copenhagen Business School - Department of Strategic Management and Globalization ( email )

Kilevej 14
Frederiksberg, 2000
Denmark

HOME PAGE: http://www.cbs.dk/smg

Bjorn Ambos

University of St. Gallen - Institute of Technology Management ( email )

Dufourstrasse 40a
St. Gallen, CH-9000
Switzerland

Vienna University of Economics and Business ( email )

Welthandelsplatz 1
Vienna, Wien 1020
Austria

Paper statistics

Downloads
222
Rank
115,224
Abstract Views
871