¹Department of Business Administration, College of Business, University of Illinois at Champaign-Urbana, IL, USA

Correspondence: Ricardo G Flores, Department of Business Administration, College of Business, University of Illinois at Champaign-Urbana, 350 Wohlers Hall-1206 South Sixth St, Champaign, IL 61820, USA. Tel: +1 217 333 2588; Fax: +1 217 244 7969; E-mail: rgflores@uiuc.edu

Received 23 November 2005; Revised 22 May 2007; Accepted 8 June 2007; Published online 2 August 2007.

Abstract

In this paper we examine foreign location choices of the top 100 US multinational corporations (MNCs) in 1980 and 2000. We first ask whether there has been a change in MNC foreign location choice in this two-decade period. Second, we explore the underlying reasons of location change by focusing on country-level factors, accounting for firm-, industry- and regional-level explanations. Our findings suggest, first, that the extent of MNCs' activities around the globe is more extensive than assumed by regionalists' arguments and well beyond Ohmae's TRIAD, but still less widespread than claimed by the globalists – the two main traditions within the globalization–regionalization debate. Second, we uncover an interesting de-location pattern in this period. Third, we develop an integrative framework where both economic and institutional-cultural arguments are shown to influence MNCs' foreign location choice in different ways. We conclude with a discussion of our findings, and provide suggestions for future research.