Multinational networks during times of economic crisis versus stability

Abstract

From a network view of multinational enterprises, we argue that foreign subsidiaries in multinational networks have access to resources in heterogeneous institutional environments, and that by taking advantage of these linkages they can capitalize on the latent flexibility that resides in being part of a multinational network. We compare the performance of subsidiaries during times of economic crisis versus stable periods to determine the environments in which intra- and inter-firm organizational linkages matter most. Results indicate that the enhanced flexibility associated with intra- and inter-firm organizational linkages is more likely to increase the performance of subsidiaries operating in crisis rather than economically stable environments. © Gabler Verlag 2008.