This thesis examines the challenges multinational enterprises face from political risk when making and operating foreign direct investments. The thesis considers political risk and a wide variety of approaches to its analysis and provides insight into the process of foreign direct investment, the nature of the political threat facing it, foreign investment decision making by multinationals, and the tools developed in the commercial, academic, and governmental arenas to avoid and combat the effects of political risk. In essence, the thesis addresses a business application of theories and methodologies used in political studies. The first hypothesis is: if political risk is properly understood as a phenomenon of the political environment, then it a) defies direct quantification and b) can be explained as a series of discrete elements which can be analyzed separately. The second hypothesis is: if political risk is properly understood as a series of non-quantifiable elements, analysis of political risk cannot be depended upon alone to protect multinational enterprises from political risk in foreign direct investment. The first hypothesis is addressed through a critical review and consideration of business and political risk literature. Two analytical tools are developed in this process: a ladder of cognition consisting of a series of conditions of knowledge which can be held regarding a specific risk, and indicating the type and approximate accuracy of analysis which can be undertaken of such risk; and a representation of the political risk equation as a two stage process consisting of an abstract (environmental) risk event and a discrete effect which the event may or may not have on a specific investment. The second hypothesis is addressed through a critical review of methods of political risk analysis including "qualitative" approaches with roots in traditional studies and "quantitative" approaches derived from statistical analysis and behavioralist-based determinism. Critiques of each approach include operational strengths and weaknesses, performance histories (when applicable), conceptual and practical capabilities from the perspective of the analytical tools described above, and theoretical strengths and weaknesses from the perspective of the political studies discipline. Both hypotheses are supported and the thesis concludes by reviewing tools which can be used by multinationals to manage and mitigate the effects of political risk and considering additional academic work in this arena which would be useful in developing this application of political studies.

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Multinational corporations (MNCs) around the globe commonly use cross-border related-party transactions (CRPTs) to shift profits from high tax jurisdictions to low ones to avoid paying taxes. The Organization for Economic Co-operation and Development and G20 countries launched the Base Erosion and Profit Shifting (BEPS) Action Plans in 2013 to constrain tax avoidance behaviors of MNCs, particularly the widespread use of CRPTs. This study examines how the localization of the BEPS Action Plans affects the tax avoidance behavior of MNCs in China. Using all the listed non-financial MNCs on the Stock Exchanges in China from 2012 to 2017, I find that: (1) Chinese MNCs with more CRPTs are more likely to pay less taxes than those with less CRPTs. Localization of the BEPS Action Plans does not have significant impact on this behavior. (2) The effect of localization of BEPS Action Plans to constrain corporate tax avoidance is more pronounced on MNCs with relatively poor information quality in the pre-location period; (3) local government-controlled firms (LG firms) with more CRPTs engage in more tax avoidance, but localization of the BEPS Action Plans significantly constrains tax avoidance activities by these firms in the post-location period. These findings should shed light on what mechanisms could constrain MNCs’ tax avoidance, especially income shifting through CRPTs, and how it could be affected by tightening of the tax laws on tax avoidance activities and by ownership structure in a developing country setting, in particular.

A firm can deploy a variety of arrangements (entry modes) like wholly owned subsidiaries, joint ventures, contracts, and export modes to implement its product market strategies in foreign countries. Each of these arrangements entails decisions about the location of production facilities and/or marketing operations, and the type of ownership of these operations. The choice of an entry mode is of strategic importance to a firm because it can involve investment of substantial amount of resources and has a strong bearing on the firm's marketing mix. Due to its strategic importance, the entry mode choice phenomenon has been extensively researched. In the past, seven major theories have been proposed but none is able to explain the choice from the complete set of entry modes. Thus, there exists a gap between the theory and practice of entry mode choice. This study provides breakthrough on two fronts. First, it develops a new theory of entry mode choice grounded in the resource-based perspective of the firm. The theory posits that the decision to locate its production and/or marketing operations in a country is related to the actualizability of the firm's competitive advantage in that country. However, the ownership decision is related to the sustainability of that advantage. Second, based on this theory, a model is developed which explains entry mode choices from the complete set of entry modes. Mail survey responses of Presidents/CEOs of 163 American firms with international operations support the model. The proposed framework is an effort to fill the gap between theory and practice of entry mode choice. It is expected to make a substantial contribution toward developing a sound theory of international operations of the firm. The framework is broader in scope than the extant theories because it transcends across industries and nationalities of firms.

A research report submitted to the Faculty of Commerce, Law and Management, University of the Witwatersrand, in partial fulfilment of the requirements for the degree of Masters of Commerce (Development Theory and Policy) 15 April 2016 / Using a multiple case study approach of three R&D performing firms in South Africa, this research explored whether current R&D internationalisation trends are having a positive or negative effect on South Africa’s investments in research and development (R&D). The research found that, contrary to theoretical proposition, the three firms have not relocated core parts or their entire R&D to technologically advanced countries abroad as a result of their increased international exposure. Instead, they have broadened their scope of R&D to integrate foreign-based knowledge inputs. The research also found that increased internationalisation causes firms to alter their approaches to R&D exploitation through incremental improvements on- and/or finding new applications ofexisting technologies and creating new markets for them. Three motives influenced the firms, namely to access new knowledge not available locally, to access human capital and to exploit existing capabilities in new markets. Where firms reduced their local R&D investment, such activities were not being relocated to abroad. Increased competition fostered firms’ R&D efficiency. Firms reviewed their internal structures to maximise intellectual property (IP) value; they adopted stricter methods for evaluating new R&D requirements; and they afforded higher priority to R&D with better potential for success. Most of this is meant to exploit existing knowledge. The findings are applicable to Emerging Economy Multinational Enterprises (EMNEs) that already have well-established R&D capability at home and experience operating in the international R&D environment. / MT2017

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by Chan Kwok-luen. / Bibliography: leaf 95 / Thesis (M.B.A.)--Chinese University of Hong Kong, 1986

Kong Sau-mui, So Kwok-hing. / Thesis (M.B.A.)--Chinese University of Hong Kong, 1981. / Bibliography: leaves 78-79.

Decisions regarding foreign market entry and market entry mode are strategically important to multinational corporations (MNCs). Most previous studies have focused on the economic rationale behind these decisions and assumed that MNCs' decisions are rational and independent of their own and other MNCs' previous decisions. / In conclusion, the evidence noticeably refutes the claim that there is only an economic explanation for the decisions regarding foreign market entry and market entry mode, and demonstrates that organizational legitimacy, a social consideration, can play a key role in explaining an MNC's decision. / This thesis develops the neoinstitutional perspective of foreign direct investment strategy. The main proposition is that an MNC's decision regarding foreign market entry and subsidiary ownership level represents its desire to gain external and internal organizational legitimacy, and its decision is influenced by its own previous decisions and the previous decisions of other MNCs from the same home country. In the empirical setting of Japanese MNCs' foreign investments across the world over the period 1987--1999, I find supporting evidence for my main argument. First, other MNCs' entry into a market induces an MNC to enter the same market to gain external organizational legitimacy and an MNC's prior overseas establishments trigger its subsequent market entry to gain operational experience. Second, an MNC selects to trade a portion of its subsidiary ownership level for external and internal organizational legitimacy by forming an equity joint venture with local partners or industry incumbents. Third, in uncertain situations, an MNC mimics the prevalent, legitimate subsidiary ownership level strategy adopted by other MNCs in the same geographical region, and it is more prone to make a mimetic choice when its subsidiary is located in a less-developed country than in a developed country. / Chan Man-kuen Christine. / "July 2002." / Source: Dissertation Abstracts International, Volume: 63-10, Section: A, page: 3630. / Supervisor: Shige Makino. / Thesis (Ph.D.)--Chinese University of Hong Kong, 2002. / Includes bibliographical references (p. 174-193). / Electronic reproduction. Hong Kong : Chinese University of Hong Kong, [2012] System requirements: Adobe Acrobat Reader. Available via World Wide Web. / Electronic reproduction. Ann Arbor, MI : ProQuest dissertations and theses, [200-] System requirements: Adobe Acrobat Reader. Available via World Wide Web. / Abstracts in English and Chinese. / School code: 1307.