The eclectic paradigm in the global economy

John Cantwell, Rajneesh Narula

Research output: Contribution to journalArticlepeer-review

97 Scopus citations

Abstract

Economic globalisation and the subsequent growth of global and alliance capitalism have fundamentally affected the way in which MNC activities are undertaken and organised. The various contributions to this special issue have evaluated the eclectic paradigm in the global economy, and its validity as a theoretical basis to understand these developments. This paper places these contributions into context. We highlight that globalisation has increased the interactive dynamics between and among 'O', 'L' and 'I' characteristics at firm, industry and country level, in at least two ways. First, a knowledge-based society has meant that the efficient exploitation of MNCs' ownership advantages and the continual need to augment and sustain their competitive advantages is ever more crucial, leading to a complex interdependence between ownership and location advantages. Second, globalisation has affected how MNCs seek to organise their cross-border activities coherently in response to changing boundaries of the firm. We find that the paradigm continues to provide a framework which facilitates how best to synthesise relevant complementary theories, or how to choose between potentially competing theories, and helps to operationalise them.

Original languageEnglish (US)
Pages (from-to)155-172
Number of pages18
JournalInternational Journal of the Economics of Business
Volume8
Issue number2
DOIs
StatePublished - Jan 1 2001
Externally publishedYes

All Science Journal Classification (ASJC) codes

  • Business, Management and Accounting (miscellaneous)
  • Economics and Econometrics

Keywords

  • Asset Augmentation
  • Eclectic Paradigm
  • Economic Development
  • Innovation Alliances
  • Internationalisation
  • Mncs
  • Technological Change
  • Transaction Cost Theory

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