The Advantage View Of The Enterprises' Internationalization: Current Theories And Reality Of China

The internationalization of Chinese enterprise gradually becomes one of the hot issues in China economic field and these companies going abroad is also an inevitable trend. However, there is a problem which deserves consideration from all sides. That is on what advantages Chinese enterprises should depend in internationalizing. All the traditional multinational theories emphasize that multinational corporations (MNCs) should rely on some advantages. So as the companies of developing countries, what advantages on earth do Chinese MNCs depend on? I will try to probe into this problem in this paper.There are two-layer meanings of studying this problem. Theoretically, there still aren't relative theories to explain the internationalization of Chinese MNCs, so the study in this paper may provide some references for the establishment of theories for China's internationalization; Practically, the multinationalization of Chinese companies is still in the stage of development. Only under the guidance of relative theory can they go smoothly. And this paper may provide some guidance in the nurturing and taking into play of the advantages of Chinese enterprises.So as a latter competitor, on what does China's multinational corporations (MNCS) depend to compete with those MNCs in developed countries?Firstly, I review the classical multinational corporation theories in this paper, pointing out the operating advantages that these theories analyzed, for example, the Monopolistic Advantage Theory emphasizes that it is necessary for corporations to operate abroad.Secondly, I analyzed the empirical basis of the classical theories from both entrepreneurial and industrial levels in the third part. What's more, I also explain the process how these theories came out in detail, and give relative cases to prove the operating advantages put forward in the second part further. The analysis makes it clear that China has many differences with the former developed countries in the aspects of country, industrial and entrepreneurial backgrounds. Therefore, these theories are not completely applicable for China. So our task is to the specific advantages of china's MNCs.Finally, on the basis of analyzing the current situation and background of China's internalization, the advantages of China's MNCs are put forward in this part. I categorized the advantages into two levels—county and entrepreneurial levels. And divide the entrepreneurial-level advantages into state-owned enterprises and private-owned enterprises further. Then, I list three relatively typical companies and analyze the tips they give after the cases. Based on the previous analysis and the typical cases, I summarized the dependable advantages for China, including the enterprises' scale economics and its core asset power as well as the target countries' location advantage. In view of the difficulty in quantifying these advantages, I take The Capital Steel Co. LTD as an case to quantifying scale economy's impact over internalization and the proof are generally given through the empirical test.