Transatlantic Investment by Multinational Firms: A Rivalistic Phenomenon?
Abstract
(1978). Transatlantic Investment by Multinational Firms: A Rivalistic Phenomenon? Journal of Post Keynesian Economics: Vol. 1, No. 1, pp. 82-99.
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Early progress in IB oligopoly theory has not been followed up.
“Early progress in IB oligopoly theory has not been followed up (Rowthorn & Hymer, 1971; Knickerbocker, 1973; Graham, 1978).”
From The Internalization Theory of the Multinational Enterprise: Past, Present and Future (2020) · cites this paper as Graham, 1978
Cites
Oligopolistic reaction and multinational enterprise
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“Similar hypotheses to our own derived from assuming oligopolistic or rivalrous behavior have been a subject of study in the field of international business (Knickerbocker, 1973; Graham, 1978; Hennart and Park, 1994; Anand and Kogut, 1997).”
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“Most particular as explored by Knickerbocker (1973) in his 'follow my leader' hypothesis and Graham (1978) in his exchange of threats hypothesis.”
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“For example, Horstman and Markusen (1996), or Motta (1996), following Graham (1978), suggest that FDI can be explained as rivalrous behaviour between oligopolists, as well as in terms of ownership advantages or location advantages.”
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“Strategic behavior theory provides the rationale that interdependent competitive firms tend to minimize risk by following the leader (Casson 1987; Graham 1978).”
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“Thus, oligopolistic reaction in FDI activities should be examined not on firms from the same home country, but on firms from different countries [Rowthorn 1971; Graham 1978; Choi, Tschoegl and Yu 1986].”
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“some sectors (Dunning 1986a; Knickerbocker 1973; Graham 1978, 1985; Lake 1976a”
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Campbell, A. J., & Verbeke, A. (1994) · doi:10.1016/0024-6301(94)90213-5 · Cited by 174
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“(e.g. Graham, 1978; Ito and Rose, 2002).”
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“…(1992) longitudinal analysis of the international behavior of 168 large service MNCs, clearly point to the conclusion that the international behavior of multinational service firms mirrors that of manufacturing firms as identified by Flowers (1976), Graham (1978), Knickerbocker (1973) and others.”
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“A group of Vernon’s doctoral students, notably Knickerbocker (1973), Graham (1978) and Flowers (1976), argued that it was not just locational variables that determined the spatial distribution of the economic activity of firms but their strategic response to these variables and to the anticipated…”
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BackgroundComplex dependence in foreign direct investment: network theory and empirical analysis
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BackgroundInward investment, industry concentration and the speed of adjustment
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Determinants of Foreign Direct Investment by Food and Tobacco Manufacturers
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Local vs. Global Location of Firms and Industries
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“This is basically exchange of threats (tit for tat strategy) to business moves by foreign rivals (Graham, 1978).”
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Purcell, W., & Nicholas, S. (2001) · Tourism Management · doi:10.1016/s0261-5177(00)00055-8 · Cited by 21 · see citing works
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“The effects of specific strategic behaviour towards rivals for MNCs’ activities are analysed in Knickerbocker (1973), Cowling & Sugden (1987 ) Graham (1978, 1992).”
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Branston, J., Cowling, K., & Tomlinson, P. (2014) · doi:10.2753/pke0160-3477370109 · Cited by 19
“…(Cowling et al., 2000). behavior in different geographical markets and this in turn will tend to reinforce (and sustain) the degree of collusion (Graham, 1978; hymer, 1976).11 the analysis so far relates to periods of relatively stable economic activity, where the level of excess capacity is…”
BackgroundResultInfluentialInternalization theory: An unfinished agenda
Casson, M., Porter, L. A., & Wadeson, N. (2016) · International Business Review · doi:10.1016/j.ibusrev.2016.03.007 · Cited by 24 · see citing works
“The link to IO goes back to the international oligopoly models of Rowthorn and Hymer (1971), Vernon (1971), Knickerbocker (1973) and Graham (1978), whilst the link to innovation goes back to Cantwell (1989).”
BackgroundDeterminants of inward investment in the UK, a panel analysis
Driffield, N. (2002) · doi:10.1080/00036840110099243 · Cited by 18
“This is based on the work of Graham (1978) , and has been extended more recently by Rowthorn (1992), who for example shows that FDI will be dependent on market size. In addition, Rowthorn demonstrates that multinational ®rms undertake FDI to protect their home markets. Motta (1994) extends the analysis one stage furth…”
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Transnationals, International Organization and Deindustrialization
Pitelis, C. N. (1993) · doi:10.1177/017084069301400404 · Cited by 17
“brocker (1973) developed the idea of defensive investments, while Graham (1978) regarded cross-investments as an exchange of”
BackgroundCross-Investment: A Second Front of Economic Rivalry
Encarnation, D. J. (1987) · doi:10.2307/41165237 · Cited by 17
Kandoğan, Y. (2013) · International Business Review · doi:10.1016/j.ibusrev.2013.11.005 · Cited by 15 · see citing works
“They are driven by better access to markets, including those of competitors (Graham, 1978), existence of high tariff barriers, and ability to establish relationships with customers and thus develop market knowledge.”
BackgroundSeyf, A. (2001) · International Journal of the Economics of Business · doi:10.1080/13571510151075350 · Cited by 15 · see citing works
“US FDI in the Asian tiger economies may come under this category.”
BackgroundInfluentialStrategic Asset Seeking by EMNEs: A Matter of Liabilities of Foreignness – or Outsidership?
Petersen, B., & Seifert, R. E. (2014) · Emerald Group Publishing Limited eBooks · doi:10.1108/s1745-886220140000009015 · Cited by 12 · see citing works
Does market context impact payoffs to internationalization
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Japanese Exports and Foreign Direct Investment: Imperfect Competition in International Markets
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Cho, J. (2023) · Asian Business & Management · doi:10.1057/s41291-023-00250-5 · Cited by 13
“Notwithstanding previous research describing the “follow-the-leader” (Knick-erbocker, 1973) and “exchange-of-threat” (Graham, 1978) reactions, the competitive dynamics literature has not explored how external competitive pressure from industry globalization shapes how firms pursue competitive…”
Determinants of financing of outward foreign direct investment by Indian MNEs
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“Last but not least, economic theorists have modelled strategic moves made in the 1970s to “follow the leader” in order to balance strategic power again (Knickerbocker, 1973) or to “cross invest” in order to disturb the competitive balance on a global scale (Graham, 1978).”
BackgroundFactors Influencing Foreign Direct Investment (FDI) Location Selection: A Review of the Literature
Bakar, A. H. A., Sinnappan, P., Salim, F. A. A., & Teo, P.-C. (2022) · International Journal of Academic Research in Business and Social Sciences · doi:10.6007/ijarbss/v12-i7/14103 · Cited by 12
“Companies that see foreign firms entering their own domestic market may consider retaliating by entering the host country market (Graham, 1974, 1978; Vernon, 1974; Watson, 1982; Karnani and Wernerfelt, 1985; Hennart and Park, 1994).”
BackgroundAli, M. (2016) · doi:10.1093/cje/bev062 · Cited by 12
“Graham (1978) was one of the earliest to note that European direct investment in the USA may be defensive in nature.”
BackgroundResultInfluentialThe Multinational Firm and the Theory of Industrial Organization
Acocella, N. (1992) · doi:10.1007/978-1-349-11771-0_10 · Cited by 12
The Internationalization of Singaporean Small and Medium-Size Enterprises
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“…Aspelund and Moen 2005; Bilkey 1982; Cavusgil 1984); entry of foreign firms into the domestic market posing a threat to domestic firms (Karadeniz and Gocer 2007); and key domestic rivals entering foreign markets, inducing domestic firms to match the moves and not be left behind (Graham 1978).”
BackgroundForeign direct investment and industry demands for trade protection
Zeng, K., & Sherman, R. (2009) · doi:10.1080/09692290802454182 · Cited by 11
“2 It should be noted that the dampening effect of FDI on the filing of AD duties reported by Hiscox (2004) is dependent on mobility across industries.”
BackgroundDriffield, N., & Love, J. (2005) · doi:10.1093/cpe/bzi003 · Cited by 11
Globalization: The Epochal Imperatives and Developmental Tendencies
Bina, C. (1997) · doi:10.1007/978-1-4615-6169-9_3 · Cited by 11
Global oligopolistic competition and foreign direct investment
Hansen, M. W., & Hoenen, A. K. (2016) · Critical Perspectives on International Business · doi:10.1108/cpoib-03-2014-0017 · Cited by 9 · see citing works
“…is surprising, given the fact that the early IB scholars - inspired by the industrial organization (IO) tradition - already in the 1970s argued that interaction with rivals in oligopolistic industries is a key driver of MNC strategy (e.g. Graham, 1974, 1978; Flowers, 1976; Knickerbocker, 1973).”
BackgroundMethod
- Authors
- Graham, E. M.
- Corresponding author
- Graham, Edward M.
- Venue
- Journal of Post Keynesian Economics
- Publisher
- Informa UK Limited
- Published
- 1978-09
- Volume
- 1
- Issue
- 1
- Pages
- 82-99
- ISSN
- 0160-3477 (ISSN-L)
- 1557-7821
- OpenAlex
- W122128307
- Cited by
- 234
- References
- 32
- Citations by year
- 2026: 2 · 2025: 1 · 2024: 3 · 2023: 5 · 2022: 2 · 2021: 3 · 2020: 2 · 2019: 3 · 2018: 5 · 2017: 8 · 2016: 7 · 2015: 7 · 2014: 11 · 2013: 11 · 2012: 7
- FWCI
- 3.20
- Type
- journal article
- Language
- en
- Open access
- closed
- Locations
- Journal of Post Keynesian Economics (publishedVersion)
- RePEc: Research Papers in Economics (submittedVersion)
- Topics
- Social Sciences › Business, Management and Accounting › Strategy and Management › International Business and FDI
- Social Sciences › Economics, Econometrics and Finance › General Economics, Econometrics and Finance › Global trade and economics
- Social Sciences › Economics, Econometrics and Finance › Finance › Global Financial Crisis and Policies
- Keywords
- multinational corporations, foreign direct investment, rivalry, international capital flows
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