The evolving geographic scope of the MNE: Towards a dynamic view of regional multinationals

Where firms operate has been a central concern in the field of international business. The most recent manifestation of interest in this area is, arguably, the rapid growth of literature on regional multinationals (RMNEs). These studies provide considerable empirical evidence of a strong home-region bias among large multinational companies. Nevertheless, such studies are largely silent about the factors that lead managers to choose certain foreign locations when expanding their operations. In part, this omission is the result of the methodological approach favored in this literature, which consists of categorizing firms on the basis of their footprint at a given point in time. Our study contributes to the literature on RMNEs by carrying out a detailed analysis of the international expansion of a Fortune Global 500 company over a period of 20 years, starting with its first international foray. On the basis of this in-depth case study, we develop a model that explains the prevalence of RMNEs as a result of co-evolutionary dynamics among environmental factors, managerial agency and a firm's geographic scope.