TY - JOUR
T1 - The dynamics of the liability of foreignness
T2 - A global study of survival in financial services
AU - Zaheer, Srilata
AU - Mosakowski, Elaine
PY - 1997/6
Y1 - 1997/6
N2 - We study the impact of 'foreignness' on survival in interbank currency trading worldwide over the period 1974-93. In particular, we develop hypotheses on the behavior of the liability of foreignness over time, and on the consequences of evolving sources of firm-level competitive advantage on this liability. We test these hypotheses on the population of 2667 market-making trading rooms located in 47 countries worldwide that either existed in 1974 or entered the industry between 1974 and 1993. The results show that there is a liability of foreignness, and that it changes over time. Further, strategic and organizational factors such as the adoption of technology by these firms and their mode of internal control significantly influenced survival, as did location-related factors such as the intensity of local and foreign competition.
AB - We study the impact of 'foreignness' on survival in interbank currency trading worldwide over the period 1974-93. In particular, we develop hypotheses on the behavior of the liability of foreignness over time, and on the consequences of evolving sources of firm-level competitive advantage on this liability. We test these hypotheses on the population of 2667 market-making trading rooms located in 47 countries worldwide that either existed in 1974 or entered the industry between 1974 and 1993. The results show that there is a liability of foreignness, and that it changes over time. Further, strategic and organizational factors such as the adoption of technology by these firms and their mode of internal control significantly influenced survival, as did location-related factors such as the intensity of local and foreign competition.
KW - Dynamic competitive advantage
KW - Financial services
KW - Liability of foreignness
KW - Multinational enterprise
KW - Organizational ecology
UR - http://www.scopus.com/inward/record.url?scp=0001171863&partnerID=8YFLogxK
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U2 - 10.1002/(sici)1097-0266(199706)18:6<439::aid-smj884>3.3.co;2-p
DO - 10.1002/(sici)1097-0266(199706)18:6<439::aid-smj884>3.3.co;2-p
M3 - Article
AN - SCOPUS:0001171863
SN - 0143-2095
VL - 18
SP - 439
EP - 463
JO - Strategic Management Journal
JF - Strategic Management Journal
IS - 6
ER -