The paper will investigate the influence of RTAs on MNEs’ supply chain configurations. To do so, the behaviour of German MNE's after the 2004 EU enlargement will be considered, and German MNE's’ supply chain activities in the new EU member states before and after the countries’ accessions will be compared.
In contrast to previous research focusing on FDI and trade flows, this research, based on secondary data of the German Central Bank and the World Bank Group, relies on further indicators to capture the effects of supply chain configuration. Supply chain activities of German MNEs' in the Czech Republic, Latvia, Poland and Slovenia grew faster after 2004, while in Estonia a slower growth in supply chain activities post 2004 was noticeable.
For the case of Cyprus, Hungary, Lithuania, Malta and Slovakia an overall positive development after 2004 was observable even though for single indicators a slower growth was detected. The results demonstrated that the EU accession increased German MNEs’ supply chain activities in the new EU member countries, but country differences, based on locational characteristics the individual countries possess, exist.
Table of Contents
1. Introduction
2. Literature Review
3. Methodology
3.1 Data
3.2 Concepts and Operationalisation
3.3 Analysis and Strategy
4. Analysis of Findings
4.1 German MNEs’ supply chain activities in the EU-10
4.2 Locational differences in German MNEs’ supply chain activities
4.2.1 The beautiful swans: Czech Republic, Latvia, Poland, and Slovenia
4.2.2 The ugly duckling: Estonia
5. Conclusion
Objectives and Research Themes
This dissertation investigates how regional trade agreements (RTAs), specifically the 2004 European Union enlargement, influence the supply chain configurations of German multinational enterprises (MNEs). By analyzing data from the German Central Bank and the World Bank Group regarding the EU-10 member states, the research aims to determine how regional economic integration shifts supply chain activities and identifies which locational characteristics drive these organizational decisions.
- Impact of regional economic integration on MNE supply chain structures.
- Comparative analysis of German MNE activities in EU-10 countries pre- and post-2004.
- Identification of locational factors influencing production relocation.
- Evaluation of market-seeking versus efficiency-seeking behavior in supply chain management.
- Investigation of regional integration as a catalyst for increased intra-regional trade.
Excerpt from the Book
4.2 Locational differences in German MNEs’ supply chain activities
The proposition ‘Factors besides regional economic integration influence the decision of German firms to relocate their supply chain activities, thus these are unevenly distributed in the new EU member states’ is discussed to determine which country factors were decisive in attracting German MNEs post-2004. The aspect is of significance as Dunning (1997b) and Blomstrom and Kokko (1997) argue that RTAs themselves do not influence economic relations between states, but affect other variables like market sizes and labour costs, thus having an indirect impact on member state’s locational advantages.
Even though German firms enjoyed the advantages of standardized industry and consumer standards, resulting in higher German MNE activities in all EU-10 states, differences in the level of MNE activities were caused by production and transaction costs (Dunning 1997a). Following the EU-10’s accession, the competition for foreign investors by offering good locational conditions began, a process Levy-Yeyati, Stein and Daude (2003) describe as a ‘beauty contest’ for FDI.
Summary of Chapters
1. Introduction: Presents the research scope, focusing on the influence of the 2004 EU enlargement on the supply chain configurations of German multinational enterprises.
2. Literature Review: Discusses theoretical foundations regarding internationalization, regional economic integration, and factors influencing supply chain configuration decisions.
3. Methodology: Details the explanatory and deductive research approach, utilizing secondary quantitative data from the German Central Bank and World Bank Group to analyze trends.
4. Analysis of Findings: Examines the actual shifts in supply chain activities in the EU-10 post-2004, providing a detailed comparison between countries to explain locational variances.
5. Conclusion: Synthesizes the results, confirming that while EU accession generally increases attractiveness, specific country characteristics like infrastructure and proximity remain decisive for MNE engagement.
Keywords
Regional economic integration, German MNEs, supply chain configuration, European Union, 2004 enlargement, EU-10, Foreign Direct Investment, trade liberalization, locational factors, offshoring, production facilities, international trade, market-seeking, efficiency-seeking, comparative analysis.
Frequently Asked Questions
What is the core focus of this research?
This work examines how regional economic integration, particularly the 2004 EU enlargement, impacts the way German multinational enterprises structure and configure their supply chains in Eastern European countries.
Which countries are considered in the analysis?
The research focuses on the EU-10 countries that joined the European Union in 2004: Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia, and Slovenia.
What is the primary research goal?
The main objective is to identify if and how regional trade agreements drive the relocation of supply chain activities and to explain the differences in how these countries attract German MNEs.
Which scientific methodology is applied?
The study uses a quantitative, deductive approach based on the analysis of longitudinal secondary data from the German Central Bank and the World Bank Group covering the period from 2001 to 2007.
What are the main topics discussed in the literature review?
The review covers general firm internationalization motives, regional economic integration theories, and specific supply chain management factors such as cost reduction, lead times, and supplier relationships.
Which keywords best describe this study?
Key terms include regional economic integration, supply chain configuration, German MNEs, EU-10, Foreign Direct Investment (FDI), and locational advantages.
Why is Estonia classified as the "ugly duckling" in the analysis?
Estonia is labeled as such because, unlike most other EU-10 countries, it showed significant negative developments and a loss in attractiveness for German MNEs following the 2004 accession.
What role does the Opel plant in Gliwice play in the study?
The Opel case study serves as a practical example demonstrating how locational advantages, such as proximity to suppliers and infrastructure, successfully influenced real-world supply chain configuration decisions after 2004.
- Arbeit zitieren
- Stefan Bömer (Autor:in), 2018, How does regional economic integration influence MNEs’ supply chain configurations?, München, GRIN Verlag, https://www.grin.com/document/1166988
