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Dynamic capabilities of emerging market multinational enterprises and the Uppsala model

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Abstract

In this paper, we extend the existing understanding of the Uppsala model to explain a dynamic evolution. We adapt Teece’s distinction between operational and dynamic capabilities to build a theory that explains the characteristics of emerging multinational enterprises’ (EMBEs) internationalization process. Arguing both theoretically and empirically from the study of the Chinese electrical appliance company Gree, Ltd., we submit that the two sub-processes of dynamic capabilities—knowledge development and commitment—create continuous opportunity discoveries and development. Through these processes, we can garner a deeper understanding of EMBEs’ leading to dynamic capabilities that allow for the development of firm-specific advantages from which a radical internationalization process is achieved.

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Notes

  1. Internationalization is entering markets new to the focal firm and globalization is changing the coordination systems in order to coordinate the various, differentiated units of the multinational business enterprises (MBE) (Vahlne and Ivarsson 2014; Vahlne et al. 2011).

  2. Our own terminology had been that the firm level is the micro-level, macro is the level of the aggregate, and hence lower levels of analyses of the firm, we labeled as mille-micro-level. However, with the concept of the micro-foundation widely accepted, we adjusted: micro-foundations deal with “deep structure” of the firm (Foss 2011).

  3. 9 are located in China, 1 in Brazil and 1 in Pakistan.

  4. The facilities are located in Changsha, Zhengzhou, Shijiazhuang, Wuhu and Tianjin.

  5. Lamda Compressor Co. Ltd., Gree Electrical Co. Ltd., Kaibang Motor Manufacture Co., Ltd., Xinyuan Electronics Co., Ltd, Intelligent Equipment Co., Ltd and Precision Mould Co. Ltd.

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Acknowledgement

The authors would like to acknowledge the financial support provided by University of Macau under MYRG Grant No. MYRG2018-00171-FBA.

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  1. Faculty of Business Administration, University of Macau, Avenida Padre Tomás Pereira, Taipa, Macau

    Jie Wu

  2. School of Business, Economics and Law, Centre of International Business Studies, University of Gothenburg, Box 610, 40530, Goteborg, Sweden

    Jan-Erik Vahlne

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Wu, J., Vahlne, JE. Dynamic capabilities of emerging market multinational enterprises and the Uppsala model. Asian Bus Manage 21, 690–714 (2022). https://doi.org/10.1057/s41291-020-00111-5

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