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Title: Consider Cost and Strategy When Choosing Between Expatriate and Host-National Managers

Authors: R. Andrew Schaffer; Jay Hyuk Rhee

Addresses: Author address listing can be found in the "About the Authors" section at the end of the article.

Abstract: This paper develops an overseas staffing formula and seven propositions in international human resource management based on internalization costs and firm strategy. The formula and propositions outline the relative internalization costs of host-country managers versus expatriate managers. Our discussion centers on why firms, based on internalization costs, may choose expatriates over host-nationals (or vice-versa). The moderating effect of the organization's strategy on the relationship between internalization costs and the staffing decision is then presented. These topics should be of interest to practitioners who recruit and select managers for foreign assignments. The propositions and formula also should be of interest to global staffing researchers.

Keywords: Expatriate managers; host-national managers; internalization costs; staffing strategy; international human resource management.

DOI: 10.1504/JBM.2005.141130

Journal of Business and Management, 2005 Vol.11 No.1, pp.59 - 71

Published online: 05 Sep 2024 *