Charting Dynamic Trajectories: Multinational Enterprises in India


Khanna, Tarun, and Prithwiraj Choudhury. 2014. “Charting Dynamic Trajectories: Multinational Enterprises in India.” Business History Review, 88, 1-38. Copy at
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In this article, we provide a synthesizing framework that we call the “ dynamic trajectories ” framework to study the evolution of multinational enterprises (MNEs) in host countries over time. We argue that a change in the policy environment in a host country presents an MNE with two sets of interrelated decisions. First, the MNE has to decide whether to enter, exit, or stay in the host country at the onset of each policy epoch; second, conditional on the fi rst choice, it has to decide on its local responsiveness strategy at the onset of each policy epoch. India, which experienced two policy shocks — shutting down to MNEs in 1970 and then opening up again in 1991 — offers an interesting laboratory to explore the “ dynamic trajec- tories ” perspective. We collect and analyze a unique dataset of all entry and exit events for Fortune 50 and FTSE 50 fi rms (as of 1991) in India in the period from 1858 to 2013 and, addition- ally, we document detailed case studies of four MNEs (that arguably represent outliers in our sample)

Last updated on 07/17/2014