| Scholars have identified multinational corporations (MNCs) as increasingly important and influential actors in international politics. However, mainstream international studies scholarship has failed to explain why MNCs succeed or fail in entering foreign markets. Market entry is a particularly vexing question for U.S. and Chinese firms seeking to compete for each other's consumers. As this study shows, surprising differences in success among U.S. firms in China, as well as Chinese firms in the U.S., suggest that statist and market factors interact with corporate strategies in confounding ways. Through case studies in the internet, automobile and fast food industries, this dissertation builds a theoretical framework that better explains why some MNCs succeed in foreign markets while others fail. Empirical studies show that two contrasting cultures (universalism vs. particularism, individualism vs. collectivism, and rule-based vs. relation-based governance) make it more difficult for Chinese MNCs and American MNCs to adapt to their counterpart's market. Although the study finds some support for the cultural dissimilarity argument, it finds that culture alone is an insufficient explanation. The results suggest that statist and market factors like ownership, sector industry, interest groups, entry mode and choice of location are also determinants of a MNC's success in a foreign market. Based on those findings, the study provides suggestions for both Chinese MNCs and American MNCs seeking to compete in each other's markets. |
