Abstract
The IB literature informs us of several ways to measure firms’ degree of globalization. In this paper we make the argument that in fact none of the existing indices really measure firms’ degree of “global specialization”, that is, to what extent their allocation of resources is multidomestic or global.
In order to remedy this we introduce a complementary index measuring how firms are configuring their value chains — whether they are replicating value chain activities from country to country or locating them in globally specialized units in order to exploit an international division of labor. We then test this “global specialization” index empirically on a sample of Danish MNCs.
We find that the index is able to identify a distinct group of firms with significantly higher degrees of global value chain configuration. The firms in this group do not necessarily score high on conventional internationalization measures.
In order to remedy this we introduce a complementary index measuring how firms are configuring their value chains — whether they are replicating value chain activities from country to country or locating them in globally specialized units in order to exploit an international division of labor. We then test this “global specialization” index empirically on a sample of Danish MNCs.
We find that the index is able to identify a distinct group of firms with significantly higher degrees of global value chain configuration. The firms in this group do not necessarily score high on conventional internationalization measures.
| Original language | English |
|---|---|
| Pages (from-to) | 791-813 |
| Number of pages | 21 |
| Journal | Management International Review |
| Volume | 47 |
| Issue number | 6 |
| DOIs | |
| Publication status | E-pub ahead of print - 15 Dec 2006 |