The underdetermined knowledge-based theory of the MNC

Fransson, Anders, Håkanson, Lars and Liesch, Peter W. (2011) The underdetermined knowledge-based theory of the MNC. Journal of International Business Studies, 42 3: 427-435. doi:10.1057/jibs.2011.6

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Author Fransson, Anders
Håkanson, Lars
Liesch, Peter W.
Title The underdetermined knowledge-based theory of the MNC
Journal name Journal of International Business Studies   Check publisher's open access policy
ISSN 0047-2506
Publication date 2011-04
Year available 2011
Sub-type Article (original research)
DOI 10.1057/jibs.2011.6
Open Access Status
Volume 42
Issue 3
Start page 427
End page 435
Total pages 9
Editor Lorraine Eden
Anne Hoekman
Place of publication Basingstoke, Hants, U.K.
Publisher Palgrave Macmillan
Collection year 2012
Language eng
Formatted abstract
In this note we revisit two core propositions of the knowledge-based view of the firm found in the seminal work of Kogut and Zander: (1) that multinational corporations (MNCs) exist because transfers and re-combinations of knowledge occur more efficiently inside MNCs than between MNCs and third parties; and (2) that the threat of opportunism is not necessary, although it may be sufficient, to explain the existence of the MNC. Their knowledge-based view shifted the conceptualization of the firm from an institution arising from market failure and transaction costs economizing to a progeny of superior knowledge governance. We question these conclusions, arguing that firms are but one of the many types of “epistemic communities” possessing and nurturing procedural norms, identity, and the cognitive, linguistic and reflexive attributes conducive to efficient exchange and re-combination of knowledge among their members. Important insights may be gained by applying the concept of epistemic communities implicit in the knowledge-based perspective beyond firm-level hierarchies.
© 2011 Academy of International Business All rights reserved.
Keyword Theory of the MNC
Epistemic communities
Transaction cost economics
Q-Index Code C1
Q-Index Status Confirmed Code
Institutional Status UQ

Document type: Journal Article
Sub-type: Article (original research)
Collections: Official 2012 Collection
UQ Business School Publications
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Citation counts: TR Web of Science Citation Count  Cited 8 times in Thomson Reuters Web of Science Article | Citations
Scopus Citation Count Cited 9 times in Scopus Article | Citations
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Created: Fri, 11 Mar 2011, 11:30:24 EST by Karen Morgan on behalf of UQ Business School