Luo, Y., & Tung, R. L. (2007).

Question 1

Springboard Perspective 🌍

Answer 1

EM MNEs use international expansion as a “springboard” to acquire strategic resources, overcome home country constraints, and compete globally through aggressive, risk-taking strategies like acquisitions.

Question 2

Latecomer Disadvantage ⏳

Answer 2

EM MNEs enter global markets later than traditional MNEs, lacking brand recognition, technology, and experience. They overcome this by acquiring firms with established brands and tech in advanced markets.

Question 3

Leapfrog Strategy 🚀

Answer 3

Unlike traditional firms that expand gradually, EM MNEs “leapfrog” by rapidly entering foreign markets through acquisitions or greenfield investments to accelerate their global presence.

Question 4

Typology of EM MNEs 🏢

Answer 4

1. Niche Entrepreneurs – Small, focused international firms
2. World-Stage Aspirants – Large, diversified private MNEs
3. Transnational Agents – State-owned MNEs with broad international reach
4. Commissioned Specialists – State-owned firms focused on a few key markets

Question 5

Asset-Seeking vs. Opportunity-Seeking 🎯

Answer 5

Asset-seeking: Acquiring tech, brands, or expertise to compensate for weaknesses

Opportunity-seeking: Expanding to bypass trade barriers, gain government benefits, or enter high-growth markets

Question 6

Coopetition (Competition + Cooperation) 🤝

Answer 6

EM MNEs both compete and collaborate with global rivals. Example: Ranbaxy (India) partners with GlaxoSmithKline for R&D but competes with them in drug markets.

Question 7

Round-Tripping Investment 🔄

Answer 7

EM MNEs invest abroad, then reinvest back home under a foreign subsidiary name to gain tax benefits
and preferential treatment from their home government.

Question 8

Challenges of EM MNEs ⚠️

Answer 8

• Weak corporate governance & transparency
• Lack of global experience & managerial expertise
• Post-merger integration difficulties
• Weaker innovation capabilities compared to advanced MNEs

Question 9

How do EM MNEs differ from Newly Industrialized Economy (NIE) MNEs in their international expansion strategies?

A) EM MNEs prefer minority joint ventures, whereas NIE MNEs favor acquisitions
B) NIE MNEs tend to internationalize gradually, while EM MNEs adopt a leapfrog strategy
C) EM MNEs focus only on domestic markets, while NIE MNEs prioritize exports
D) EM MNEs rely on ethnic networks more than NIE MNEs

Answer 9

B.

Question 10

What is the main argument of the “springboard perspective” in international expansion?

Select one alternative:

a. Emerging market MNEs internationalize to acquire strategic assets and reduce home market constraints

b. Emerging market MNEs expand internationally to avoid competition at home

c. Emerging market MNEs internationalize only when their domestic market is saturated

Answer 10

A.