Knowledge Transfer From MNC Parent To China Subsidiary

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Journal of World Business 39 (2004) 168–182

An integrated model of knowledge transfer from
MNC parent to China subsidiary
Pien Wanga,*, Tony W. Tongb, Chun Peng Kohc a School of Business, National University of Singapore, 1 Business Link, Singapore 117592, Singapore b Fisher College of Business, The Ohio State University, Newark, OH, USA c International Enterprise Singapore, Singapore

Abstract
Based on an empirical study of 62 firms, this paper develops a two-stage model describing knowledge transfer from MNCs to their China subsidiaries. In the first stage, the model proposes factors affecting the extent of knowledge contributed by an MNC to its China subsidiary. In the second stage, the model proposes factors affecting the extent of
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The development of the model is based on existing literature on FDI, knowledge transfer, and organizational learning. It also draws heavily on findings from interviews with 62 firms, supplemented with observations made of firms interviewed, and materials gathered from company archives and publication. While existing literature enables the model to be deeply grounded in established theories, data from the interviews of firms operating in China and other sources help us identify new variables and discover unexpected relationships between variables (Glaser & Strauss, 1967).
Detailed descriptions of the methods employed in our study are presented next.

1. Methods
1.1. Data sources
Our study collected data from three sources: interviews, observation and documentation. The primary data source was interviews. We conducted semi-structured interviews with 83 managers of 62 firms
(Table 1). These firms included 4 holding companies
(HCs), 17 wholly owned enterprises (WOVs), 30 equity joint ventures (EJVs), 2 contractual joint ventures (CJVs), 1 representative office (RO) and 8 firms

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with mixed forms of operations. Among the 30 EJVs,
18 and 7 were majority-owned and minority-owned by the MNC parents respectively, with the rest 5 of them being 50–50 EJVs. With the exception of two firms, which were from the service sector, the rest of the 60 firms spanned various manufacturing
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