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The post-World War II rise of multinational enterprises spurred initial theoretical explanations for international expansion. Early frameworks like the Product Life Cycle Theory described innovation-driven export and production shifts, while the Uppsala Model emphasized gradual, experiential learning in foreign markets. These process-oriented approaches highlighted entry patterns but offered limited prescriptive guidance for strategic choice, setting the stage for more robust firm-level paradigms.
In the 1970s and 1980s, core economic theories emerged as foundational pillars. Internalization Theory, rooted in transaction cost economics, explained why firms internalize cross-border transactions within hierarchies to protect knowledge assets. John Dunning's Eclectic Paradigm (OLI Framework) integrated ownership, location, and internalization advantages to comprehensively explain multinational existence and strategy. These schools provided the economic rationale for global operations, focusing on efficiency and advantage sourcing.
Strategic management frameworks soon addressed how firms configure and coordinate activities worldwide. The Integration-Responsiveness Framework crystallized the central tension between global integration and local responsiveness, leading to canonical strategy typologies: global, multi-domestic, and transnational. This was complemented by adaptations of generic value-chain configuration strategies to international settings. Bartlett and Ghoshal's Transnational Solution explicitly modeled a networked organizational form balancing efficiency, responsiveness, and learning, becoming a dominant prescriptive ideal.
From the 1990s, resource-based and institutional perspectives significantly enriched the subfield. The Resource-Based View, applied globally, emphasized firm-specific resources and capabilities as drivers of sustainable cross-border advantage. Dynamic Capabilities extended this to address innovation and renewal in volatile international environments. Institutional Theory, through constructs like institutional distance and legitimacy, systematically explained strategic adaptation to varied regulatory, normative, and cultural contexts. These lenses offered complementary mechanisms to the earlier economic and strategic frameworks.
Contemporary global strategy research is characterized by the coexistence of these major paradigm families. The economic foundations of Internalization Theory and the Eclectic Paradigm remain central for explaining multinational boundaries and location. The strategic frameworks of Integration-Responsiveness and the Transnational model continue to guide organizational design and competitive positioning. Meanwhile, the resource-based and institutional schools provide deeper analysis of capability development and contextual embeddedness. Together, they form a durable, multifaceted academic identity for the subfield.