Inflow of Foreign Direct Investment (Fdi) and Management Approaches of Multinationals in Nigeria
Keywords:
Foreign Direct Investment (FDI), Management Approaches, Multinational Corporations (MNC)
Abstract
The study investigated the implication of foreign direct investment flows in the prevalence of management approaches in thirty multinational organizations in Nigeria. The multivariate regression analysis was employed for the identification of factors in the Nigeria investment environment (other than fiscal performance) that may have strong mediating impact. Results from the analysis showed that the predominant staffing strategy in most multinational organizations with FDI presence skew to polycentric (β = 0.28; p < 0.05) staffing approach more than to ethnocentric (β = 0.03; p < 0.05). This can be explained by the prevalence of host country staffers occupying strategic position in host country’s offices. Manager’s perception of employee effectiveness is largely influenced by the employee level of aptitude and the employee tacit personality traits.
References
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37. Li, Xiaoying and Xiaming Liu. (2004); “Foreign direct investment and economic growth: An increasingly endogenous relationship”. World Development, 3(3): 393-407.
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41. Obadan, M. I. (2004); “Foreign Capital Flows and External Debt: Perspectives on Nigeria and the LDCs Group”. Lagos: Broadway Press Ltd.
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44. Oghojafor, B., George, O. and Owoyemi, O. (2012); Corporate Governance and National Culture are Siamese Twins: The Case of Cadbury (Nigeria) Plc. International Journal of Business and Social Science., 3(15): 270.
45. Onodugo Vincent.A (2013); Multinational corporations (MNCs) and employment and labour conditions of Developing Countries: The Nigerian Experience. European Journal of Business and SocialSciences,1( 6), 67-76.
46. Osuagwu, E.S., Nwokoma, N. (2017), Empirical assessment of the competitive conduct of Nigerian banks in a post-consolidation era. Research in International Business and Finance, 41, 412-422.
47. Plesner Rossing C (2013) Tax strategy control: the case of transfer pricing tax risk management. Manag Account Res 24:175–194
48. Prahalad, C.K. and Bettis, R.A. (1986) The Dominant Logic: A New Linkage between Diversity and Performance. Strategic Management Journal, 7: 485-501.
49. Pudelko M, Tenzer H (2013) Subsidiary control in Japanese, German and US multinational corporations: direct control from headquarters versus indirect control through expatriation. Asian Bus Manag 12:409–431
50. Schaaper J, Mizoguchi S, Nakamura H, Yamashita S (2011) Control of French and Japanese subsidiaries in China: implementing control mechanisms before and after the global economic crisis. Asia Pac Bus Rev 17:411–430
51. Ulrich, D., Brockbank, W., Ulrich, M., Younger, J., 2013, Global HR Competencies: Mastering competitive value from the outside in, (NY: McGraw-Hill,).
52. Umoh, O., Jacob, A., & Chuku, C. (2012); Foreign Direct Investment and Economic Growth in Nigeria: An Analysis of the Endogenous Effects. Current Research Journal of Economic Theory, 4(3), 53–66.
53. UNCTAD. (2009). Nigeria ranks 19th in the world in attracting FDI. Retrieved from http//www.UNCTAD - export. http://www.unctad.org/en/docs/diaeia2009_en.pdf (Accessed: 19.09.2021).
54. UNCTAD, (2010); United Nations Conference on Trade and Development. World Investment Report: the world investment prospect survey 2010-2012. Available fromhttp://www.unctad.org/en/docs/diaeia20104_en.pdf (Accessed: 19.09.2021).
55. UNCTAD, (2018): United Nations Conference on Trade and Development .World Investment Report: Transnational Corporations and the Infrastructure Challenge. Available from: www.unctad.org/en/docs/wir2018_en.pdf (Accessed: 12.09.2021).
56. Williams C, van Triest S (2009) The impact of corporate and national cultures on decentralization in multinational corporations. Int Bus Rev 18:156–167
57. Wood, G., Mazouz, K., Yin, S., 2014, “FDI from emerging nations to Africa: The HRM context,” Human Resource Management, 53(1): 179-201.
58. Wright, P. M., Snell, S. A., 2005, “Partner or Guardian: HR’s Challenge in Balancing Value and Values,” Human Resource Management, Summer 2005, Vol 44, No 2: 177-182.
2. Akinlo, A. E. (2004); Foreign direct investment and growth in Nigeria: An empirical investigation. Journal of Policy Modeling, 26, 627 – 639.
3. Alugbuo, C.C. (2002), Foreign Direct Investment in Nigeria: Determinants and Impacts: An unpublished PhD thesis. Federal University of Technology Owerri, Nigeria
4. Alfaro, L. (2006), “How Does Foreign Direct Investment Promote Economic Growth? Exploring the Effects of Financial Markets on Linkages”, NBER working paper, No 12522.
5. Alfaro, L. (2017); Gains from Foreign Direct Investment: Macro and Micro Approaches. World Bank Economic Review 30, Suppl. 1 (March): S2–S15.
6. Asiedu, E. (2003) “Capital controls and foreign direct investment”. World Development, 32(3): 497-90.
7. Barrett, G.V. and Bass, B.M. (1976); Values and the Search for value – free dimensions of culture. Journal of Cross-Cultural Psychology, 18, 143 -164.
8. Bemde-Nabende, A., J. Ford, S. Sen and Slater J (2002); “Foreign Direct Investment in East Asia: Trends and Determinants”. Asia Pacific Journal of Economics and Business 6(1): 4-25.
9. Bernardine,H. J. (2003.) Human Resources management: An Experiential Approach, New York: MacGraw-Hill Incorporation.
10. Bird, A., Taylor, S. and Beechler, S. (1998); A typology of human resource management in Japanese Multinational corporations: Organizational Implications. Human Resources Managemen Journal 37(2).
11. Botrić, V., & Škuflić, L. (2006); Main Determinants of Foreign Direct Investment in the Southeast European Countries. Transition Studies Review, 13(2), 359–377.
12. Butler, P., McEvoy, G. 2012, “Strategic human resource management and performance: Sharpening the vision,” HRM Review, 22: 43-56.
13. Bwalya, S. M. (2006). Foreign direct investment and technology spillovers: Evidence from panel data analysis of manufacturing firms in Zambia. Journal of Development Economics 81, 514–526.
14. Carkovic, M. and R. Levine (2002); “Does foreign direct investment accelerate economic growth?” University of Minnesota Working Paper Minneapolis. Available at: www. Worldbank.org/research/conferences/ financial-globalization/fdi.pdf.
15. Chenery, H. B., & Stout, A. (2006); Foreign assistance and economic development. Journal of Development American Economic Review, 55, 679 – 733.
16. Choe, J. Il. (2003); Do Foreign Direct Investment and Gross Domestic Investment Promote Economic Growth? Review of Development Economics, 7(1), 44–57.
17. Chowdhury, A. and G. Mavrotas (2006). FDI and Growth: What Causes What? World Economy 29(1), 9-19.
18. Cools M, Slagmulder R (2009) Tax-compliant transfer pricing and responsibility accounting. J Manag Account Res 21:151–178
19. De Gregorio, Jose. (2003) “The role of foreign direct investment and natural resources in economic development”, Working Paper No 196, Central Bank of Chile, Santiago.
20. Dossi A, Patelli L (2008) The decision-infuencing use of performance measurement systems in relationships between headquarters and subsidiaries. Manag Account Res 19:126–148
21. Dossi A, Patelli L (2010) You learn from what you measure: fnancial and non-fnancial performance measures in multinational companies. Long Range Plan 43:498–526
22. Dupasquier, C. & Osakwe, P. (2005); “Foreign Direct Investment in Africa: Performance, Challenges and Responsibilities”, African Trade Policy Centre, 21, p.6
23. Dutse, A. Y. (2008); Nigeria’s economic growth: Emphasizing the role of FDI in transfer of technology. Journal of communications of the IBIMA, 3, 12-14.
24. Ekpo, A. H. (2010); Government policy and foreign private investment in Nigeria. The Guardian, p.21.Eviews User’s Guide. (1994 – 1997). Quantitative micro software. United States of America.
25. El-Fergani, S. A. (2003); The Contribution of FDI Economic Development in Libya (in Arabic).Paper presented at the Symposium of Libyan Economy and to Spare the Oil Income, 23 June 2003, University of Al-Thadi.
26. Funke, & Nsouli. (2003), Foreign private investment: Determinants, performance and promotion. CBN Bulletin, pp: 108-112.
27. Guest, D. 2011, “HRM and performance: Still searching for some answers”, HRM Journal, 21(1): 1-13.
28. Hafsi, T. and Farashahi, M. (2005); Applicability of Management theories to developing countries: a synthesis. 45(4).
29. Harzing A-W (2001) Of bears, bumble-bees, and spiders: the role of expatriates in controlling foreign subsidiaries. J World Bus 36:366–379
30. Heyman, W., Teisceva, A.C. 2010, “Is human capital relevant in attracting innovative FDI to China?” FEP Working Papers, No. 388, October, Faculty of Economics: University of Portugal: October Hill, W. L.
31. Charles (2013) International Business, Ninth Edition, Tata McGraw Hill Hofstede, G. (1993); Cultural Constraints in Management Theories, Academy of Management Executive, 7(1): 81-94.
32. Jaumotte, F. (2004); “Foreign direct investment and regional trade agreements: The market size effect revisited”, IMF Working Paper No. 04/206. International Monetary Fund, Washington, D.C.
33. Jaussaud J, Schaaper J (2006) Control mechanisms of their subsidiaries by multinational frms: a multidimensional perspective. J Int Manag 12:23–45
34. Khaliq, A., & Noy, I. (2007); Foreign direct investment and economic growth: Empirical evidence from sectoral data in Indonesia. Retrieved from http://www.economics.hawaii.edu/research/workingpapers/WP_07-26.pdf
35. Kraus K, Lind J (2010) The impact of the corporate balanced scorecard on corporate control—a research note. Manag Account Res 21:265–277
36. Lepak, D. P., Shaw, J. D., 2008, ”Strategic HRM in North America: looking to the future,” The International Journal of Human Resource Management, Vol. 19, No. 8, August 2008, 1486–1499
37. Li, Xiaoying and Xiaming Liu. (2004); “Foreign direct investment and economic growth: An increasingly endogenous relationship”. World Development, 3(3): 393-407.
38. Porter, M. E. (2000); “Measuring the National Environmental Performance and its Determinant”, in Jeffrey Sachs, et al., eds, The Global Competitiveness Report, New York: Oxford University Press.
39. Müller, T. and M. Schnitzer (2006). Technology transfer and spillovers in international joint ventures Journal of International Economics 68, 456-468
40. Nankervis, A., Baird, M., Coffey, J., & Shields, J. 2013, Human Resource Management: Strategies & Practice, 8thed., Melbourne: Cengage.
41. Obadan, M. I. (2004); “Foreign Capital Flows and External Debt: Perspectives on Nigeria and the LDCs Group”. Lagos: Broadway Press Ltd.
42. Obwona, Marios B. (2004), “Foreign direct investment in Africa”. In Financing Pro-Poor Growth: AERC Senior Policy Seminar VI, Kampala, Uganda, 2-4 March 2004 – Seminar Papers, pp. 60-95. Nairobi: Arican Economic Research Consortium.
43. OECD. (2002). Foreign direct investment for development and maximising benefits. Office for national statistics. Retrieved from http//www.ons.gov.uk/statbullettin on 09.01.2018.
44. Oghojafor, B., George, O. and Owoyemi, O. (2012); Corporate Governance and National Culture are Siamese Twins: The Case of Cadbury (Nigeria) Plc. International Journal of Business and Social Science., 3(15): 270.
45. Onodugo Vincent.A (2013); Multinational corporations (MNCs) and employment and labour conditions of Developing Countries: The Nigerian Experience. European Journal of Business and SocialSciences,1( 6), 67-76.
46. Osuagwu, E.S., Nwokoma, N. (2017), Empirical assessment of the competitive conduct of Nigerian banks in a post-consolidation era. Research in International Business and Finance, 41, 412-422.
47. Plesner Rossing C (2013) Tax strategy control: the case of transfer pricing tax risk management. Manag Account Res 24:175–194
48. Prahalad, C.K. and Bettis, R.A. (1986) The Dominant Logic: A New Linkage between Diversity and Performance. Strategic Management Journal, 7: 485-501.
49. Pudelko M, Tenzer H (2013) Subsidiary control in Japanese, German and US multinational corporations: direct control from headquarters versus indirect control through expatriation. Asian Bus Manag 12:409–431
50. Schaaper J, Mizoguchi S, Nakamura H, Yamashita S (2011) Control of French and Japanese subsidiaries in China: implementing control mechanisms before and after the global economic crisis. Asia Pac Bus Rev 17:411–430
51. Ulrich, D., Brockbank, W., Ulrich, M., Younger, J., 2013, Global HR Competencies: Mastering competitive value from the outside in, (NY: McGraw-Hill,).
52. Umoh, O., Jacob, A., & Chuku, C. (2012); Foreign Direct Investment and Economic Growth in Nigeria: An Analysis of the Endogenous Effects. Current Research Journal of Economic Theory, 4(3), 53–66.
53. UNCTAD. (2009). Nigeria ranks 19th in the world in attracting FDI. Retrieved from http//www.UNCTAD - export. http://www.unctad.org/en/docs/diaeia2009_en.pdf (Accessed: 19.09.2021).
54. UNCTAD, (2010); United Nations Conference on Trade and Development. World Investment Report: the world investment prospect survey 2010-2012. Available fromhttp://www.unctad.org/en/docs/diaeia20104_en.pdf (Accessed: 19.09.2021).
55. UNCTAD, (2018): United Nations Conference on Trade and Development .World Investment Report: Transnational Corporations and the Infrastructure Challenge. Available from: www.unctad.org/en/docs/wir2018_en.pdf (Accessed: 12.09.2021).
56. Williams C, van Triest S (2009) The impact of corporate and national cultures on decentralization in multinational corporations. Int Bus Rev 18:156–167
57. Wood, G., Mazouz, K., Yin, S., 2014, “FDI from emerging nations to Africa: The HRM context,” Human Resource Management, 53(1): 179-201.
58. Wright, P. M., Snell, S. A., 2005, “Partner or Guardian: HR’s Challenge in Balancing Value and Values,” Human Resource Management, Summer 2005, Vol 44, No 2: 177-182.
Published
2022-06-25
How to Cite
Alugbuo, C. C., Ikwumezie, D. A., & Okoro, D. C. U. (2022). Inflow of Foreign Direct Investment (Fdi) and Management Approaches of Multinationals in Nigeria. International Journal on Economics, Finance and Sustainable Development, 4(6), 137-150. https://doi.org/10.31149/ijefsd.v4i6.3285
Section
Articles
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