Strategic configurations: exploring MNEs’ commitment reduction in an emerging economy

Commitment reduction in the foreign investment process is a critical strategic decision for multinational enterprises (MNEs). Recognizing the complex nexus of drivers for MNE commitment reduction in an emerging economy, this study investigates the configurations of resource, industrial, and institutional factors that collectively influence the strategic decision of commitment reduction. We incorporated the strategic tripod framework to reveal the interactive patterns among various sets of factors influencing the investment reduction decisions of MNEs. Using fuzzy-set qualitative comparative analysis (fsQCA), we analyzed foreign investment reduction by MNEs operating across nineteen industries in China between 2013 and 2019. Our findings identify configurational solutions leading to four propositions, applying the strategic tripod to explain MNE commitment reduction decisions. This study concludes with important theoretical and practical implications, suggesting ideas for pushing the research landscape further.