多国籍企業研究第12号

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1【Research Papers】Why Do MNCs Divest or Retain Foreign Subsidiaries?Approaches from Dependency and Redundancy in Subsidiary NetworksNaoki Yasuda（Junior Associate Professor Tokyo University of Science）Abstract Existing research examines the characteristics of subsidiaries, parent firms, and countries to explain why multinational corporations (MNCs) divest foreign subsidiaries. In contrast, this study applies a network perspective to explain the decision to divest foreign subsidiaries. First, this study applies the concept of dependency in proposing that MNCs are less likely to divest a subsidiary if the subsidiary has a high degree of hub and authority functions in the subsidiary networks. Second, this study uses a logic of redundancy to predict that MNCs are likely to divest a focal subsidiary if redundancy in subsidiary functions is high, to make the subsidiary networks more efficient. Moreover, this study discusses the logic of redundancy and economies of density in subsidiary networks. Using data from Japanese foreign affiliates, including transaction information among subsidiaries, this study finds a significant support for these predictions. KeywordsDivestment, subsidiary networks, dependency, redundancy, economies of densityINTRODUCTION Previous studies have offered significant insights regarding why multinational corporations (MNCs) divest their foreign subsidiaries. The traditional argument is that MNCs divest subsidiaries due to poor performance of the subsidiary (e.g., Duhaime & Grant, 1984). Studies have also investigated the factors that encourage subsidiary divestment, focusing on the characteristics of the subsidiaries, parent firms, and/or host and home countries (e.g., Dai, Eden, & Beamish, 2017). This study extends the literature on subsidiary divestment by considering subsidiary network effects. Foreign subsidiaries form subsidiary networks (Ghoshal & Bartlett, 1990; Gupta & Govindarajan, 1991), and secure the flow of resources such as exports and imports across subsidiary networks (e.g., Song, 2015). The network perspective appears in studies on operational 多国籍企業研究（2019）12号、1～18 2019（C）多国籍企業学会　http://www.mne-jp.org/