Commentary: Internalization theory and its relation to RBV and TCE

Rugman's work contains critical elements of both the resource-based view and transaction cost economics within the framework of internalization theory. The framework that he helped develop not only explains the raison d’être of the MNE but has also been extended to explicate the choice among different organization modes for cross-border exploitation of complementary assets. I show the continued relevance of both the concept of FSAs and the concept of transaction costs to explaining the expansion of MNEs and their choice of market entry mode today.