Modern research in international business strategy (IBS) builds upon a limited number of foundational concepts. Four elements stand out as the canvas for many contemporary research studies (Verbeke, 2013). First, firm-specific advantages (FSAs) that allow compa-nies to overcome the additional costs of doing business abroad. Second, country-specific advantages (CSAs), with home-country factors operating as building blocks for devel-oping corporate strengths, and with a limited number of critical host country charac-teristics determining location choices. Third, the idea that increased globalization at the macro-level holds the promise of at least some benefits of subsidiary network integration at the micro-level. Such benefits accrue especially to multinational enterprises (MNEs) commanding strong non-location bound FSAs. Fourth, the prediction that international diversification at the micro-level comes with corresponding needs for investments in contextual intelligence and novel resource combination, i.e., strategies of situational respon-siveness. Such strategies in turn typically mean reduced product diversification, for the corporate head office to retain effective control over the MNE’s internal network. The intrinsic value of the above canvas does not change with the COVID-19 pandemic. But the ‘new normal’ created as the outcome of the pandemic does suggest that the four notions of FSAs, CSAs, benefits of subsidiary integration, and requisite trade-off between international and product diversification, as typically embedded in IBS research designs, may need to be revisited. Such rethinking of concepts will avoid ill-advised prescriptions, misaligned with the coming post-pandemic state of the world economy.
- COVID-19, decoupling, governance, institutional quality, interna-tional business strategy, subsidiary integration