Three essays on market penetration by multinational enterprises

Market entry literature explains the strategic choices of firms in new markets, but it does not fully analyze performance in host markets. The main contribution of my dissertation is examining a firm's entry and expansion strategy as well as its heterogeneous performance across geographic markets. In addition, it suggests that the old perspective of uniform internationalization should be replaced by a new perspective of non-uniform internationalization.; The first chapter analyzes why multinational enterprises (MNEs) prefer the home-region to foreign regions. This question is answered by the transaction cost theory and the double diamond approach through a sophisticated literature review and empirical evidence. The home region effect significantly increases the likelihood of entry into foreign markets just as the host country's characteristics significantly affect the market entry strategies of MNEs.; Looking at the micro behaviors of firms, the second chapter analyzes the roles of markets and resources and examines how these factors influence sales performance and decisions regarding market selection. This approach addresses how resource factors, coordinated with markets, affect sales performances differently across product segments by using the multi-level random coefficient model. Empirical findings from high-end South Korean cosmetics markets show the importance of market similarity and learning capability in sales performance and the importance of operating costs and organizational complexity in market selection.; The third chapter evaluates the cross-border strategic activities of U.S. MNEs using a conventional multinationality variable as well as new regional sales variables. First, Tobin's q equation shows that cross-border activity is a two-edged sword: foreign sales increase a firm's value, but foreign market involvements (multnationality) decrease a firm's value. Second, event study finds that the stock market negatively responses to foreign region strategic activity but positively responses to home region activity. The results from Tobin's q and event study method explains that penetrating foreign regions is costly, but the rewards are great.