Effects And Interactions Of Economic Regionalization And Home Region Orientation Of Mnes In International Expansion

This research mainly discusses the economic regionalization and the home region orientation of multinational enterprises (MNEs) in international expansion.Economic regionalization is a macroeconomic process started in1950s. It is a phenomenon of resource allocation within a region. By summarizing the theories of economic regionalization and economic globalization, and analyzing the FDI and trade facts around the world between1950s and2000s, this essay proves that the economic regionalization leaded by the three triad regions is the main pattern of the development of world economy. In short term, economic regionalization slows down the pace of economic globalization. In long term, however, economic regionalization is the necessary phase to achieve economic globalization. Economic regionalization has a significant effect on the economic globalization, the development of world trade, and the economy of developing countries.Home region orientation is a concept brought up by Rugman and Verbeke in2004. It describes the degree of regionalization of MNEs. Home region orientation is one of the three international expansion modes of MNEs. The other two modes are host region orientation and global orientation. This essay proves that the home region orientation is the main mode of the international expansion of MNEs with three measures:sales, assets, and production operations. Then, based on the resource-based view and the figures of American Fortune500, this essay proves that home region orientation negatively moderates the relationship of technology intensity and financial performance of MNEs and positively moderates the relationship of marketing intensity and financial performance of MNES.Economic regionalization describes the main pattern of world economy from a macro perspective, whereas home region orientation describes the main mode of international expansion of MNEs from a micro perspective. Economic regionalization and home region orientation have a mutual effect on each other, and jointly facilitate the development of world economy and MNEs.