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Indonesia's missing multinationals: business groups and outward direct investment


Indonesia's missing multinationals: business groups and outward direct investment

Carney, Michael and Dieleman, Marleen (2011) Indonesia's missing multinationals: business groups and outward direct investment. Bulletin of Indonesian Economic Studies, 47 (1). ISSN 0007-4918

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Official URL: http://www.tandfonline.com/doi/abs/10.1080/0007491...


Some countries produce more multinational enterprises (MNEs) than others. India and China, in particular, have produced a number of dynamic MNEs whose success abroad generates important economic benefits for the home economy. Motivated by this observation, we describe the internationalisation record of Indonesia's major business groups. Using an archival analysis method, we find that, with a few exceptions, Indonesia's largest business groupings focus predominantly upon the domestic market. We advance two explanations for this investment pattern. The first suggests that the apparent absence of Indonesian MNEs is an accounting error, because firms’ outward investment is under-reported in official statistics. The second suggests that Indonesian outward foreign direct investment is impeded by a combination of institutional and firm-level factors that arrest the internationalisation of all but the largest firms. We discuss the policy implications of these findings and reflect on their theoretical implications.

Divisions:Concordia University > John Molson School of Business > Management
Item Type:Article
Authors:Carney, Michael and Dieleman, Marleen
Journal or Publication:Bulletin of Indonesian Economic Studies
ID Code:976844
Deposited On:03 Feb 2013 21:11
Last Modified:18 Jan 2018 17:43
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