| Abstract: | Wal-Mart's exit from the German market in 2006 after 10 yearsof attempting to achieve sustainable competitive advantage contributesan interesting case to the small but expanding literature on‘failure’ in international investment. The workon the disinvest decision in all its forms has been criticalto a re-conceptualization of the international investment processas dynamic rather than static, linear and inexorable. An importantsegment of the work on investment and disinvestment as dynamicprocesses focuses on the environment in which investment anddisinvestment decisions evolve. While the environment of thehost country market has begun to be examined, the market environmentof the country in which the retail transnational corporation(TNC) originates also affects the international disinvestmentprocess. To explore this ‘home country effect’,I examine the resources Wal-Mart brought into the German marketand their ability to use those resources in the German context.Wal-Mart's resources were shaped by the market governance regimein which the firm evolved, and not insignificantly, over whichit had and has influence. Within this theoretical frame, Wal-Mart'sreliance on the resources of network dominance and autonomousaction that made for its success in the USA contributed to unsuccessfulstrategies in the German retailing market. |
