Strategic options of home country firms faced with MNC entry

Was the model able to predict which strategies were selected by the firms? For firms competing in global markets, barely half of those with strong assets chose to 'contend' with MNCs as predicted. The rest chose a 'cooperator' strategy, as did all firms with weak assets (in line with model predictions). For firms competing locally, the majority with strong assets followed the predicted 'contester' strategy, and the majority with weak assets chose a 'defender' strategy, again in accordance with the model. Statistical tests of the model resulted in acceptance of all hypotheses in the holdout sample and 3 out of 4 in the main sample. Two case studies are presented, showing the results of 'wrong' and 'correct' decisions.