Institutions, Knowledge Strategies, and EMNEs’ Cross-border Innovation

Abstract

While cross-border innovation research has made significant advancement in globalizing its reach, analyses on emerging market multinational enterprises (EMNEs) are still at a nascent stage. This chapter attempts to capture the dynamics of cross-border innovation by EMNEs. The authors’ synthesis integrates insights from institutional theory and innovation literature and offers a novel typology of EMNE innovation strategies. They describe the unique characteristics of the place (emerging markets) that tend to drive cross-border innovation, and how learning efforts and knowledge capabilities of the players (EMNEs) differ from more established multinational enterprises from developed market multinational enterprises (DMNEs). In addition, policies such as pro-market reforms that may help spur EMNE innovation across borders are discussed. The gaps identified in the synthesis serve as the springboard for future scholarly endeavours that aim to better utilize the cross-border innovation context of EMNEs.

Keywords: Emerging market multinational enterprises, Cross-border innovation, Institutions, Knowledge exploitation, Knowledge exploration