The internationalization of multinationals

This chapter examines the internationalization of the national origin of multinational enterprise (MNEs), starting with European firms at the turn of the 20th century, US firms after World War II, Japanese firms after the 1980s, and, most recently, emerging-market firms, including those from low-income countries such as China and India. The acceleration of this trend in recent decades has been driven by changes in government policy, technology, capital markets and international social networks. As a result, MNEs are being spawned in more countries, in more industries and at earlier stages of a firm's evolution than before. These changes have also transformed the established Western MNE from raw-material-seeker and tariff-jumper to efficiency- and innovation-seeker. Therefore, going forward, the MNE must be viewed as a heterogeneous entity, distinguished by national origin, size and raison d’ệtre – from resource-seeking firms to knowledge-generating and processing firms. The chapter concludes with important questions raised by these developments for future IB research.