Dynamic capabilities and innovation in MNC subsidiaries

We use the dynamic capabilities perspective from the strategic management literature in order to develop a framework that (a) differentiates between generative, sourcing and integrative capabilities in MNC subsidiaries, (b) proposes the new construct of subsidiary dynamic knowledge capability and (c) establishes direct and non-direct links between dynamic knowledge capability and subsidiary innovation. We complement this framework with theoretical propositions and discuss their implications for research and practice.