Bargaining Power Models
- Multinational Enterprises tend to adopt political strategy in negotiating favorable market entry or expansion conditions in host countries, especially in distractive industries ( such as oil, gas ang mining industries)
Through reviewing different bargaining power models such as the one tier, the two tier, and the modified one tier bargaining power models; discuss
- Factors that may change the bargaining relationships between foreign Multinational Enterprises (MNEs) and host country governments.
- Implication of changing bargaining power for political risks faced by foreign MNEs.
- Despite of the risks of political strategies, there are benefits of them.
References
EIA. (2015) Kazakhstan. Available at: https://www.eia.gov/beta/international/analysis_includes/countries_long/Kazakhstan/kazakhstan.pdf.
*EY. (2014) Kazakhstan oil and gas tax guide. Available at: http://www.pakpasinvestmentholdings.com/23.EMBAREFINERY/0.EMBA%20REFINERY%20SPECIAL%20LIBRARY/2.AUX%20EDITIONS/EY-Kazakhstan_oil_and_gas_tax_guide_2014.pdf.
Fagre N and Louis TW. (1982) Bargaining power of multinationals and host governments. Journal of International Business Studies (pre-1986) 13: 9-23.
*Kraemer R and Van Tulder R. (2009) Internationalization of TNCs from the extractive industries: A literature review. Transnational Corporations 18: 137-156.
Lecraw JD. (1984) Bargaining power, ownership, and profitability of transnational corporations in developing countries. Journal of International Business Studies (pre-1986) 15: 27-43.
*Li J, Newenham-Kahindi A, Shapiro DM, et al. (2013) The two-tier bargaining model revisited: theory and evidence from China’s natural resource investments in Africa. Global Strategy Journal 3: 300-321.
*Ramamurti R. (2001) The obsolescing ‘bargaining model’? MNC-host developing country relations revisited. Journal of International Business Studies 32: 23-39.
Boddewyn JJ. (2015) Political aspects of MNE theory. In: Cantwell J (ed) The Eclectic Paradigm: A Framework for Synthesizing and Comparing Theories of International Business from Different Disciplines or Perspectives. London: Palgrave Macmillan UK, 85-110.
Bucheli M and Kim M-Y. (2012) Political institutional change, obsolescing legitimacy, and multinational corporations. Management International Review 52: 847-877.
Cuervo-Cazurra A and Genc ME. (2011) Obligating, pressuring, and supporting dimensions of the environment and the non-market advantages of developing-country multinational companies. Journal of Management Studies 48: 441-455.
Doh J, McGuire S and Ozaki T. (2015) The Journal of World Business Special Issue: Global governance and international nonmarket strategies: Introduction to the special issue. Journal of World Business 50: 256-261.
Hadjikhani A, Lee J-W and Ghauri PN. (2008) Network view of MNCs’ socio-political behavior. Journal of Business Research 61: 912-924.
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