Between liability and asset: a critical review of 25 years of foreignness research in international business

Research output: Contribution to journalLiterature reviewpeer-review

Abstract

Purpose
The dialectics of liabilities of foreignness (LOF) and assets of foreignness (AOF) have led to further explorations of what it means for an organisation to be foreign. This paper reviews, synthesises and contextualises recent research on both the challenges and benefits of foreignness, to develop a balanced and integrated view of this international business concept.

Design/methodology/approach
This review aims at mapping the key concepts, theories, methods and contexts in the literature and organising the key findings in an antecedent-outcomes-strategy framework, explicitly comparing LOF and AOF to explore their interrelationships. Drawing on a sample of 126 journal articles, NVivo was used to code and identify key thematic areas.
Findings
The review confirms a shift in the literature towards acknowledging the notion of AOF. Using different theoretical lenses, it identifies, reviews and discusses antecedents, consequences and strategy implications of LOF and AOF. It argues that foreignness will continue to be a fundamental concept in international business research and suggests that AOF and LOF deserve an equally central place in an integrated analytical framework of foreignness in international business strategy.

Originality/value
The paper is the first systematic attempt to integrate the literature on LOF and AOF. The systematic comparison across drivers, outcomes and strategies allows for a better understanding of the advantages and disadvantages of foreignness and the underlying phenomenon of foreignness. The authors also explore the paradox perspective on foreignness.

Keywords – Foreignness; Liability of Foreignness; Asset of Foreignness; Multinational
Enterprises; Institutional Theory

Bibliographical metadata

Original languageEnglish
JournalCritical Perspectives on International Business
Early online date19 Aug 2021
DOIs
Publication statusPublished - 19 Aug 2021