Global Palette: The Impact of Immigrant Talent on Multinational Product Strategy

62 Pages Posted: 16 Feb 2024

See all articles by Dany Bahar

Dany Bahar

Brown University

Natalie Carlson

Columbia University - Columbia Business School

Exequiel Hernandez

University of Pennsylvania - The Wharton School

Date Written: December 15, 2023

Abstract

We examine how human capital at an MNC’s headquarters affects its foreign product expansion choices. We theorize that immigrant workers hired at HQ are channels of country-specific knowledge and connections that facilitate three types of product-related decisions in their home country markets: launching new products, updating existing products, and adapting products to local conditions. Drawing on two remarkably fine-grained datasets, we examine 74,906 product launches by 340 US-based multinationals in the consumer packaged goods industry in 83 foreign markets during 2009-2019, matched to 7,876 skilled immigrant hires (on H-1B visas) by these firms over the same time period. The more immigrants from a given country a firm hires in the US, the more its subsequent products in that country exhibit locally-specific features. Hiring immigrants also leads to more frequent updates of preexisting products, especially in culturally distant markets relative to the US. Immigrants also help firms launch more new products in geographically distant countries after they are hired. These associations are stronger for more culturally-specific products (i.e., food and beverages vs. household and personal care) and hold only when immigrants occupy product-related roles (e.g., R&D, marketing, management) but not when they have non-product-related roles (e.g. accounting). Our study provides granular insights on the role of human capital across critical phases of global product strategy: new product development, local adaptation capability, and ongoing product management.

Keywords: Immigration, Talent, Global Strategy, Products, Internationalization

JEL Classification: M16, M54, J61

Suggested Citation

Bahar, Dany and Carlson, Natalie and Hernandez, Exequiel, Global Palette: The Impact of Immigrant Talent on Multinational Product Strategy (December 15, 2023). The Wharton School Research Paper, Available at SSRN: https://ssrn.com/abstract=4710865 or http://dx.doi.org/10.2139/ssrn.4710865

Dany Bahar

Brown University ( email )

Box 1860
Providence, RI 02912
United States

Natalie Carlson

Columbia University - Columbia Business School ( email )

3022 Broadway
New York, NY 10027
United States

Exequiel Hernandez (Contact Author)

University of Pennsylvania - The Wharton School ( email )

3641 Locust Walk
Philadelphia, PA 19104-6365
United States

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