The resource-based theory of the transnational corporation: conceptual and empirical issues

We build on the work of Edith Penrose to develop a resource-based perspective to the theory of the transnational corporation (TNC). We suggest that trans-border geographical diversification is the result of endogenous growth processes, firms' "productive opportunity", limits to domestic expansion, failed or missing markets, perceived differential opportunities abroad, and oligopolistic interaction. The choice of institutional mode (foreign direct investment, subcontracting, licensing or exporting) is due to the same factors, but also the differential control and/or transaction cost attributes of different modes.