Skip to main content
Fachgebiete
Automobil + Motoren Bauwesen + Immobilien Business IT + Informatik Elektrotechnik + Elektronik Energie + Nachhaltigkeit Finance + Banking Management + Führung Marketing + Vertrieb Maschinenbau + Werkstoffe Versicherung + Risiko
DE
EN
Themenseiten
Organisationspsychologie Projektmanagement Marketing Smart Manufacturing
Bücher
Zeitschriften
Weitere Formate
Podcasts Webinare Technik Webinare Wirtschaft Kongresse Veranstaltungskalender Awards
Jetzt Einzelzugang starten
Zugang für Unternehmen
Referenzkunden
MTZ-Fachkongress

Antriebe und Energiesysteme von morgen


Austausch von Automobil- und Energiewirtschaft

Am 14./15. Mai geht es in Chemnitz um die Mobilitätswende durch Elektro- und Wasserstofffahrzeuge.
Erweiterte Suche
Anmelden
nach oben
Management International Review
Erschienen in: Management International Review 4/2013

01.08.2013 | Research Article

Dual-Option Subsidiaries and Exit Decisions During Times of Economic Crisis

verfasst von: Assoc. Prof. Chris Changwha Chung, Assoc. Prof. Seung-Hyun Lee, Asst. Prof. Jeoung-Yul Lee

Erschienen in: Management International Review | Ausgabe 4/2013

Einloggen

Aktivieren Sie unsere intelligente Suche, um passende Fachinhalte oder Patente zu finden.

search-config
loading …

Abstract

  • This study examines the dual implications of dual-option subsidiaries on exit decisions during times of economic crisis. Retaining dual-option subsidiaries in crisis-stricken countries means leaving a shadow option open for future growth once a crisis ends. However, MNCs may encounter problems pursuing either option due to challenges in managing dual-option subsidiaries with clashing strategic mandates.
  • The equivocal nature of dual-option subsidiaries points to the possibility of another factor playing an important moderating role in exit decisions—subsidiary performance—which has been rarely considered in the MNC real options literature. Our primary argument is that lower subsidiary performance increases the influence of shadow option value embedded in dual-option subsidiaries.
  • Analyzing a sample of 703 Korean overseas manufacturing subsidiaries in Asian countries, we find that when profitability falls, subsidiaries with dual options are less likely to be exited than those with single options.
Vorheriger Artikel Procedural Justice, Not Absorptive Capacity, Matters in Multinational Enterprise ICT Transfers
Nächster Artikel Antecedents to Government Relationship Building and the Institutional Contingencies in a Transition Economy

Sie haben noch keine Lizenz? Dann Informieren Sie sich jetzt über unsere Produkte:

Springer Professional "Wirtschaft+Technik"

Online-Abonnement

Mit Springer Professional "Wirtschaft+Technik" erhalten Sie Zugriff auf:

  • über 102.000 Bücher
  • über 537 Zeitschriften

aus folgenden Fachgebieten:

  • Automobil + Motoren
  • Bauwesen + Immobilien
  • Business IT + Informatik
  • Elektrotechnik + Elektronik
  • Energie + Nachhaltigkeit
  • Finance + Banking
  • Management + Führung
  • Marketing + Vertrieb
  • Maschinenbau + Werkstoffe
  • Versicherung + Risiko

Jetzt Wissensvorsprung sichern!

Jetzt informieren

Management International Review

MANAGEMENT INTERNATIONAL REVIEW is a double-blind refereed journal that aims at the advancement and dissemination of research in the fields of International Management.

Jetzt informieren

Springer Professional "Wirtschaft"

Online-Abonnement

Mit Springer Professional "Wirtschaft" erhalten Sie Zugriff auf:

  • über 67.000 Bücher
  • über 340 Zeitschriften

aus folgenden Fachgebieten:

  • Bauwesen + Immobilien
  • Business IT + Informatik
  • Finance + Banking
  • Management + Führung
  • Marketing + Vertrieb
  • Versicherung + Risiko




Jetzt Wissensvorsprung sichern!

Jetzt informieren
Literatur
Adner,  R., & Levinthal, D. (2004). What is not a real option: Considering boundaries for the application of real options to business strategy. Academy of Management Review, 29(1), 74–85.
Allen, L., & Pantzalis, C. (1996). Valuation of the operating flexibility of multinational corporations. Journal of International Business Studies, 27(4), 633–653.CrossRef
Allison, P. D. (1984). Event history analysis. Newbury Park: Sage.
Barkema, H., Bell, J., & Pennings, J. (1996). Foreign entry, cultural barriers, and learning. Strategic Management Journal, 17(2), 151–166.CrossRef
Bartelsman, E., Scarpetta, S., & Schivardi, F. (2005). Comparative analysis of firm demographics and survival: Evidence from micro-level sources in OECD countries. Industrial and Corporate Change, 14(3), 365–391.
Barnett, M. (2008). An attention-based view of real options reasoning. Academy of Management Review, 33(3), 606–628.CrossRef
Belderbos, R., & Sleuwaegen, L. (2005). Competitive drivers and international plant configuration strategies: A product-level test. Strategic Management Journal, 26(6), 577–593.CrossRef
Belderbos, R., & Zou, J. (2007). On the growth of foreign affiliates: Multinational plant networks, joint ventures, and flexibility. Journal of International Business Studies, 38(7), 1095–1112.CrossRef
Belderbos, R., & Zou, J. (2009). Real options and foreign affiliates divestments: A portfolio perspective. Journal of International Business Studies, 40(4), 600–620.CrossRef
Benito, G. (1997). Divestment of foreign production operations. Applied Economics, 29(10), 1365–1377.CrossRef
Benito, G. (2005). Divestment and international business strategy. Journal of Economic Geography, 5(2), 235–251.CrossRef
Benito, G., & Welch, L. (1997). De-internationalization. Management International Review, 37(2), 7–25.
Birkinshaw, J., Holm, U., Thilenius, N., & Arvidsson, N. (2000). Consequences of perception gaps in the headquarters–subsidiary relationship. International Business Review, 9(3), 321–344.
Boddewyn, J. J. (1979). Foreign divestment: Magnitude and factors. Journal of International Business Studies, 10(1), 21–26.CrossRef
Borde, S., Madura, J., & Akhigbe, A. (1998). Valuation effects of foreign divestitures. Managerial and Decision Economics, 19(2), 71–79.CrossRef
Bowman, E., & Hurry, D. (1993). Strategy through the option lens: An integrated view of resource investments and the incremental-choice process. Academy of Management Review, 18(4), 760–782.
Bowman, E., & Moskowitz, G. (2001). Real options analysis and strategic decision making. Organization Science, 12(6), 772–777.CrossRef
Brouthers, K., & Dikova, D. (2010). Acquisitions and real options: The greenfield alternative. Journal of Management Studies, 47(6), 1048–1071.CrossRef
Busby, J., & Pitts, C. (1997). Real options in practice: An exploratory survey of how finance officers deal with flexibility in capital appraisal. Management Accounting Research, 8(2), 169–186.CrossRef
Cox, D. (1972). Regression models and life-tables. Journal of the Royal Statistical Society, Series B (Methodological), 34(2), 187–220.
Cox, D., & Oakes, D. (1984). Analysis of survival data. London: Chapman and Hall.
Chung, C. C., & Beamish, P. (2005a). Investment mode strategy and expatriate strategy during times of economic crisis. Journal of International Management, 11(3), 331–355.CrossRef
Chung, C. C., & Beamish, P. (2005b). The impact of institutional reforms on characteristics and survival of foreign subsidiaries in emerging economies. Journal of Management Studies, 42(1), 35–62.CrossRef
Chung, C. C., Lu, J., & Beamish, P. (2008). Multinational networks during times of economic crisis versus stability. Management International Review, 48(3), 279–295.CrossRef
Chung, C. C., Lee, S. H., Beamish, P., & Isobe, T. (2010). Subsidiary expansion/contraction during times of economic crisis. Journal of International Business Studies, 41(3), 500–525.CrossRef
Chung, C. C., Lee, S. H., Beamish, P., Southam, C., & Nam, D. (2013).  Pitting real options theory against risk diversification theory: International diversification and joint ownership control in economic crisis. Journal of World Business, 48(1), 112–136.
Collis, D. J. (1991). A resource-based analysis of global competition: The case of the bearings industry. Strategic Management Journal, 12(Summer), 49–68.
Cuypers, I., & Martin, X. (2010). What makes and what does not make a real option? A study of equity shares in international joint ventures. Journal of International Business Studies, 41(1), 47–69.CrossRef
Dess, G., & Davis, P. (1984). Porter’s (1980) generic strategies as determinants of strategic group membership and organizational performance. Academy of Management Journal, 27(3), 467–488.CrossRef
Dixit, A. K. (1989). Entry and exit decisions under uncertainty. Journal of Political Economy, 97(3), 620–638.CrossRef
Dixit, A. K. (1992). Investment and hysteresis. Journal of Economic Perspectives, 6(1), 107–132.CrossRef
Dixit, A. K, & Pindyck, R. S. (1994). Investment under uncertainty, Princeton: Princeton University Press.
Driouchi, T., & Bennett, D. (2011). Real options in multinational decision-making: Managerial awareness and risk implications. Journal of World Business, 46(2), 205–219.CrossRef
Efron, B. (1974). The efficiency of Cox’s likelihood function for censored data. Journal of the American Statistical Association, 72(359), 557–565CrossRef
Erikson, T. (2002). Entrepreneurial capital: The emerging venture’s most important asset and competitive advantage. Journal of Business Venturing, 17(3), 275–290.CrossRef
Fisch, J. H. (2011). Real call options to enlarge foreign subsidiaries: The moderating effect of irreversibility on the influence of economic volatility and political instability on subsequent FDI. Journal of World Business,46(4), 517–526.CrossRef
Fisch, J. H., & Zschoche, M. (2012). The role of operational flexibility in the expansion of international production networks. Strategic Management Journal, 33(13), 1540–1556.
Hurry, D., Miller, A., & Bowman, E. (1992). Calls on high-technology: Japanese exploration of venture capital investments in the United States. Strategic Management Journal, 13(2), 85–101.CrossRef
Jacque, L., & Vaaler, P. (2001). The international control conundrum with exchange risk: An EVA framework. Journal of International Business Studies, 32(4), 813–832.CrossRef
Kogut, B. (1989). A note on global strategies. Strategic Management Journal, 10(4), 383–389.CrossRef
Kogut, B. (1991). Joint ventures and the option to expand and acquire. Management Science, 37(1), 19–33.CrossRef
Kogut, B., & Singh, H. (1988). The effect of national culture on the choice of entry mode. Journal of International Business Studies, 19(3), 411–432.
Kogut, B., & Kulatilaka, N. (1994a). Operating flexibility, global manufacturing, and the option value of a multinational network. Management Science, 40(1), 123–139.CrossRef
Kogut, B., & Kulatilaka, N. (1994b). Options thinking and platform investments: Investing in opportunity. California Management Review, 36(2), 52–71.CrossRef
Kulatilaka, N., & Perotti, E. C. (1998). Strategic growth options. Management Science, 44(8), 1021–1031.CrossRef
Lee, S. H., Peng, M., & Barney, J. (2007). Bankruptcy law and entrepreneurship development: A real options perspective. Academy of Management Review, 32(1), 257–272.CrossRef
Lee, S. H., & Makhija, M. (2009a). Flexibility in internationalization: Is it valuable during an economic crisis? Strategic Management Journal, 30(5), 537–555.CrossRef
Lee, S. H., & Makhija, M. (2009b). The effect of domestic uncertainty on the real options value of international investments. Journal of International Business Studies, 40(3), 405–420.CrossRef
Lee, S. H., & Song, S. (2012). Host country uncertainty, inter-MMC subsidiary shift of production, and foreign subsidiary performance: The case of Korean multinational corporations. Strategic Management Journal, 33(11), 1331–1340.CrossRef
Li, J. T. (1995). Foreign entry and survival: Effects of strategic choices on performance in international markets. Strategic Management Journal, 16(5), 333–351.CrossRef
Li, J., & Li, Y. (2010). Flexibility versus commitment: MNEs’ ownership strategy in China. Journal of International Business Studies, 41(9), 1550–1571.CrossRef
Li, Y., James, B., Madhavan, R., & Mahoney, J. (2007). Real options: Taking stock and looking ahead. Advances in Strategic Management, 24, 33–66.
McGrath, R. (1999). Falling forward: Real options reasoning and entrepreneurial failure. Academy of Management Review, 24(1), 13–30.CrossRef
Monteiro, L., Avidsson, N., & Birkinshaw, J. (2008). Knowledge flows within multinational corporations: Explaining subsidiary isolation and its performance implications. Organization Science, 19(1), 90–107.CrossRef
Myers, S. (1984). Finance theory and financial strategy. Interfaces, 14(1), 126–137.CrossRef
Ozsomer, A., & Gencturk, E. (2003). A resource-based mode of market learning in the subsidiary: The capabilities of exploration and exploitation. Journal of International Marketing, 11(3), 1–29.CrossRef
O’Brien, J. P., & Folta, T. B. (2009). Sunk costs, uncertainty and market exit: A real options perspective. Industrial and Corporate Change, 18(5), 807–833CrossRef
Padmanabhan, P. (1993). The impact of European divestment announcements on shareholder wealth: Evidence from the UK. Journal of Multinational Financial Management, 2(3/4), 185–208.
Pindyck, R. S. (1991). Irreversibility, uncertainty, and investment. Journal of Economic Literature, 29(3), 1110–1152.
Rangan, S. (1998). Do multinationals operate flexibly? Theory and evidence. Journal of International Business Studies, 29(2), 217–237.CrossRef
Reuer, J., & Leiblein, M. J. (2000). Downside risk implications of multinationality and international joint ventures. Academy of Management Journal, 43(2), 203–214.
Roth, K., & Morrison, A. (1990). An empirical analysis of the integration-responsiveness framework in global industries. Journal of International Business Studies, 21(4), 541–564.CrossRef
Rugman, A. (1979). International diversification and the multinational enterprise. Lexington: Lexington Books.
Tang, C., & Tikoo, S. (1999). Operational flexibility and market valuation of earnings. Strategic Management Journal, 20(8), 749–761.CrossRef
Therneau, T. M., & Grambsch, P. M. (2000). Modeling survival data: Extending the Cox model. New York: Springer.
Tiwana, A., Wang, J., Keil, M., & Ahluwalia, P. (2007). The bounded rationality bias in managerial valuation of real options: Theory and evidence from IT projects. Decision Sciences, 38(1), 157–181.CrossRef
Tong, T. W., Reuer, J., & Peng, M. W. (2008). International joint ventures and the value of growth options. Academy of Management Journal, 51(5), 1014–1029.CrossRef
Tong, T. W., & Li, Y. (2011). Real options and investment mode: Evidence from corporate venture capital and acquisition. Organization Science, 22(3), 659–674.CrossRef
Torneden, R. (1975). Foreign divestment by U.S. multinational corporations: With eight case studies. New York: Praeger.
UNCTAD. (2000). World investment report 2000: Transnational corporations, market structure and competition policy. New York: United Nations.
Xu, D., Zhou, C., & Phan, P. H. (2010). A real options perspective on sequential acquisitions in China. Journal of International Business Studies, 41(1), 166–174.CrossRef
Vassolo, R. S., Anand, J., & Folta, T. B. (2004). Non-additivity in portfolios of exploration activities: A real options-based analysis of equity alliances in biotechnology. Strategic Management Journal, 25(11), 1045–1061.CrossRef
Vivarelli, M., & Santarelli, E. (2007). Entrepreneurship and the process of firms’ entry, survival and growth. Industrial and Corporate Change, 16(3), 455–488.CrossRef
Metadaten
Titel
Dual-Option Subsidiaries and Exit Decisions During Times of Economic Crisis
verfasst von
Assoc. Prof. Chris Changwha Chung
Assoc. Prof. Seung-Hyun Lee
Asst. Prof. Jeoung-Yul Lee
Publikationsdatum
01.08.2013
Verlag
Springer Berlin Heidelberg
Erschienen in
Management International Review / Ausgabe 4/2013
Print ISSN: 0938-8249
Elektronische ISSN: 1861-8901
DOI
https://doi.org/10.1007/s11575-012-0157-9

Weitere Artikel der Ausgabe 4/2013

Management International Review 4/2013 Zur Ausgabe

Research Article

Antecedents to Government Relationship Building and the Institutional Contingencies in a Transition Economy

Research Article

The Role of Social Values, Accounting Values and Institutions in Determining Accounting Conservatism

Research Article

In at the Deep End of Firm Internationalization

Research Article

Procedural Justice, Not Absorptive Capacity, Matters in Multinational Enterprise ICT Transfers

Erratum

Erratum to: The Role of Social Values, Accounting Values and Institutions in Determining Accounting Conservatism

Premium Partner

    Bildnachweise