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    The strategic development of foreign owned subsidiaries and direct employment in the UK

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    Publication date
    2005
    Author
    McDonald, Frank
    Tüselmann, H-J.
    Voronkova, S.
    Dimitratos, P.
    Keyword
    Subsidiaries
    employment
    autonomy
    embeddedness
    Rights
    © 2008 Pion. [McDonald, F., Tüselmann, H. J., Voronkova, S. and Dimitratos, P. 2005]. The definitive, peer-reviewed and edited version of this article is published in Environment and Planning C: Government and Policy, Vol. 23 No. 6, pp. 867-882. Reproduced in accordance with the publisher's self-archiving policy.
    Peer-Reviewed
    Yes
    
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    Abstract
    The authors use international business strategy and regional development literature to inform a set of propositions about the links between direct employment by foreign-owned subsidiaries in the manufacturing sector and the development of embeddedness and autonomy in these subsidiaries. A large-scale survey of French, German, and US manufacturing subsidiaries in the United Kingdom is used to test the importance of embeddedness (host-country sourcing and use of networks) and autonomy (decisionmaking and operational autonomy) for the growth of employment by foreign-owned subsidiaries and the growth of skilled jobs in such subsidiaries. The results indicate that growth of embeddedness and autonomy factors are important, especially for the growth of skilled jobs, but those subsidiaries that have this attribute are a minority of foreign-owned subsidiaries. In the light of these results, the authors argue that policies need to be geared towards developing embeddedness and encouraging the growth of autonomy in subsidiaries that are likely to be regarded as central to the overall objectives of multinational corporations (MNCs). This requires policymakers to be aware of the internationalisation strategies used by MNCs, particularly in the light of the emergence of new, low-cost, countries which can easily provide high-quality but low-cost manufacturing operations. An important conclusion is that simple promotion of networking among firms and supporting agencies, and attempts to improve the local asset pool are unlikely to be effective in most cases.
    URI
    http://hdl.handle.net/10454/2590
    Version
    published version paper
    Citation
    McDonald, F., Tüselmann, H. J., Voronkova, S. and Dimitratos, P. (2005) The strategic development of foreign-owned subsidiaries and direct employment in host locations in the United Kingdom. Environment and Planning C: Government and Policy, Vol. 23, No. 6, pp. 867-882.
    Link to publisher’s version
    http://www.envplan.com/abstract.cgi?id=c0443
    Type
    Article
    Collections
    Management and Law Publications

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