Antai College of Economics and Management, Shanghai Jiao Tong U., China
We examine knowledge-based enablers of MNE solutions for inclusive economic growth. We distinguish between product adaptation and resource sharing practices as different mechanisms for disenfranchised members of society to obtain access to resources and opportunities that enhance their social and economic well-being. The former is aligned with the MNE’s short-term profit-maximization motive, while the latter with its long-term success. We focus on managerial diversity and cross-sector connections as knowledge-based factors that increase managerial awareness of socioeconomic issues and strengthen the organizational problem-solving capacity to identify effective solutions. We argue that managerial diversity and cross-sector connections contribute positively to both types of practices, but their effects are more pronounced on product adaptation practices because these are more directly related to the profit-maximization motive of the MNE. Home government social welfare provision affects MNEs’ domestic experiences with inclusion practices, and hence the degree to which these can supplement the knowledge needed for international adoption. We argue that home government social welfare provision reduces the need for product adaptation inclusion practices but raises the likelihood for resource sharing practices. We find support for our arguments by analyzing inclusion practices by 760 high-tech MNEs from 48 countries in the period 2005-2016.
