A critical perspective on the measurement of performance in the empirical multinationality and performance literature

This paper aims to contribute to the core research in international business (IB), namely, the relationship between multinationality and performance and is concerned with the quality of past empirical research designs.

On the basis of 49 studies, given in a literature review, the match between performance measures used in empirical studies and the underlying theoretical streams that explain the effects on benefits and costs of multinationality is critically evaluated.

Findings indicate that authors still largely rely on overall financial performance measures. Theoretical arguments, in contrast, refer to specific benefit and cost positions that might be better reflected in operational performance indicators. The idiosyncratic choice of the performance measures used might contribute to the varying results in past studies.

Suggestions for improving future research designs are offered.