Subsidiary-specific advantages in multinational enterprises

This paper discusses the internal patterns of competence building in the mu ltinational enterprise (MNE), with a focus on the creation of capabilities in its foreign subsidiaries. We present a new framework to synthesize 10 ty pes of MNE-subsidiary linkages leading to capability development. We find t hat several of the 10 capability development processes are associated with subsidiary-specific advantages. We discuss the process of subsidiary-specif ic advantage development within the organizational structure of the MNE whe n it is a differentiated network of dispersed operations. Copyright (C) 200 1 John Wiley & Sons, Ltd.