Local air pollution and expatriate deployment

Key findings from this study

• The study found that local air pollution significantly reduces expatriate deployment in MNE subsidiaries, with effects mediated by organizational experience and labor availability.
• The authors report that expatriates perceive air pollution as a severe stressor that diminishes commitment to international assignments.
• The researchers demonstrate that bounded reliability operates as a mechanism linking individual expatriate responses to MNE contractual and staffing decisions.

Overview

This study examines how local air pollution affects expatriate deployment decisions within multinational enterprises' international subsidiaries. The research integrates behavioral mechanisms and contractual analysis through the lens of bounded reliability. The theoretical framework addresses how environmental stressors influence both expatriate commitment and MNE staffing strategies across geographies.

Methods and approach

The researchers conducted qualitative interviews with current and former expatriates to understand behavioral responses to air pollution exposure. Quantitative analysis employed archival data from Japanese MNEs operating in Chinese cities. The authors used meteorology-based instrumental variables to address endogeneity concerns in modeling the relationship between air pollution and expatriate deployment levels.

Results

Local air pollution significantly reduces expatriate deployment in international subsidiaries. The negative relationship varies contingent on MNE local experience, local talent availability, and industry-specific pollution characteristics. Expatriates perceive air pollution as a severe stressor that diminishes assignment commitment. The data demonstrate that bounded reliability operates as a mechanism driving contractual friction between expatriates and MNEs.

Implications

The findings extend internalization theory by incorporating microfoundational elements that connect individual expatriate responses to organizational staffing decisions. Environmental conditions operate as material constraints on MNE governance structures, beyond traditional labor market and institutional factors. The bounded reliability framework explains how natural environment exposure translates into contractual tensions affecting international operations.

For expatriate management practice, these results indicate that air quality represents a substantive factor in assignment sustainability and retention. MNEs operating in high-pollution regions face measurable staffing challenges that interact with organizational capabilities and resource constraints. The contingency effects suggest that MNEs with greater local experience and adequate talent pools may buffer against pollution-driven deployment reductions.

Future research should examine whether these mechanisms extend beyond the Japanese-Chinese context to other host-country environments and pollutant types. The analytical approach demonstrates how environmental variables integrate into organizational behavior research. Additional investigation into family-level impacts and long-term health effects would strengthen understanding of pollution's role in expatriate decision-making.

Scope and limitations

This summary is based on the study abstract and available metadata. It does not include a full analysis of the complete paper, supplementary materials, or underlying datasets unless explicitly stated. Findings should be interpreted in the context of the original publication.