OSA Seminar by Viacheslav Iurkov

Domestic network centrality, uncertainty and the foreign divestment decisions of firms

2017.12.20 | Merete Elmann

Date Mon 08 Jan
Time 13:00 14:30
Location Room 2628-M211, Department of Management, Aarhus BSS, Aarhus University


Monday, 8 January at 13:00 in room 2628-M211, Viacheslav Iurkov, PhD candidate from BI Norwegian Business School, will give a seminar entitled

Domestic network centrality, uncertainty and the foreign divestment decisions of firms

 

Everyone is welcome!

 

Abstract
We investigate the role of domestic interfirm networks for the foreign divestment decisions of firms. We argue that firm foreign operations risk being divested when an increase in firm centrality in the domestic network occurs. While positive changes in firm centrality at home facilitate access to information about new business opportunities, they may lead firms to reconfigure their value chain activities and resources across locations. The resulting opportunity costs of maintaining foreign operations should subsequently lead to their divestment. Moreover, we argue that the positive association between an increase in firm centrality in the domestic network and foreign divestment is stronger under higher uncertainty, as pursuing new business opportunities at home becomes more appealing. We distinguish between firm-specific and domestic market uncertainty. We test and get support for our hypotheses using foreign subsidiary data from U.S. firms in the ICT industry.

 

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