Work

A typology of de-coupling in international sourcing by MNEs in selective de-globalization

Year: 2025

Type: article

Abstract: The 2018 U.S.–China trade war signaled the emergence of selective de-globalization, fueled by China's rapid technological advancement and growing U.S. concerns over national security and economic rivalry. Government interventions have disrupted global supply chains, compelling MNEs to reassess their sourcing strategies. This study draws on neo-institutional theory, integrating geopolitical coercive pressures and geopolitical legitimacy to analyze firms' strategic responses under selective de-globalization. Applying an abductive approach, we examine five case studies of firms from the U.S. and India. These cases reveal a shift from regulatory to geopolitical coercion, prompting a redefinition of legitimacy as geopolitical legitimacy. Through this new understanding of geopolitical legitimacy, which incorporates both home-country and global dimensions, we provide a framework for assessing MNE responses to escalating geopolitical pressures. We categorize firms' sourcing strategies into four types: substantial decoupling, symbolic decoupling, balanced decoupling, and no decoupling. Our study provides a new institutional framework for understanding MNE sourcing adjustments under selective de-globalization, offering practical insights for businesses and policymakers and suggesting future research directions.

Source: Journal of International Management

DOI: 10.1016/j.intman.2025.101304

Authors: Xuemeng Liu, Joel Hassan, Hongzhi Gao, Revti Raman Sharma

Institution: Victoria University of Wellington

Language: English

Topic: Outsourcing and Supply Chain Management

Subfield: Management Information Systems

Field: Business, Management and Accounting

Domain: Social Sciences

SDG: Peace, justice, and strong institutions

Open Access status: hybrid

Estimated APC paid: $4,020