What Are Multinational Enterprises (MNEs)
1. MNEs have a number of characteristics, including: (a) responsiveness to environmental forces such as competitors, customers, suppliers, financial institutions, and government; (b) drawing on a common pool of resources, including assets, patents, trademarks, information, and human resources; and (c) affiliates that are linked by a common strategic vision. 2. Under the premise that foreign markets are risky, companies expand their operations abroad incrementally and cautiously. Setting up a wholly-owned subsidiary is usually the last stage of doing business abroad. A typical internationalization process for a firm producing a standardized product might begin with a licensing agreement: a contractual arrangement in which one firm provides access to some of its patents, trademarks, or technology to another firm in exchange for a fee or royalty. Apart from a licensing agreement, a firm might export via an agent or distributor. This might be followed by the direct hiring of a domestic rep
