Supervising Across Borders: The Case of Multinational Hierarchies
研究了跨国公司如何根据东道国制度质量差异，选择性分配监管职责，发现制度薄弱国家的子公司更可能由外国而非本国监管单位监督，以增强全球协调。
This paper examines how multinational corporations (MNCs) selectively assign supervisory responsibilities to units in countries with varying levels of institutional quality. Arbitraging across institutional contexts is an important function of MNCs, but it also creates coordination challenges. The choice of organization structure, such as the differential assignment of supervisory responsibilities, is an important tool for managing these coordination challenges. Using data on the business activities and supervision relationships within U.S. multinational manufacturers in 1996–2008, I find that frontline subsidiaries in countries with weaker institutions are more likely to be supervised by foreign rather than domestic supervisory units. Foreign supervision is even more likely when subsidiaries in weak-institution countries conduct activities that are more central to or interdependent with their parents’ global operations. These findings confirm that MNCs use differential supervision to enhance global coordination. The paper highlights one of the most unique features of MNCs: a multinational hierarchy that resides within a firm’s boundary but across national borders. It also connects MNCs’ hierarchical structure with institutional imperfections that give rise to the emergence of the firm in the first place.