Running Head: THE VAGUENESS OF THE “COUNTRY SPECIFIC ADVANTAGE”

Purpose: The purpose of this chapter is to demonstrate that, despite the extensive literature on firm-specific advantages (FSA) and country-specific advantages (CSA) produced since Rugman’s classic matrix (1981), little progress has been made in empirically operationalizing the second concept. Design/methodology/approach: Through a review of the international business (IB) literature that refers to the CSA concept, we identify the ‘vagueness ’ in the usage of this concept. First, we present a concise literature review of the CSA construct, with a link to the ‘double diamond ’ theoretical model of Rugman and D’Cruz (1993) and Rugman and Verbeke (1993). Second, we present the results of the bibliographic analysis on the use of the construct by a variety of authors. Findings: We demonstrate the weak conceptual grounding of the CSA concept by reviewing the literature on host-CSAs attracting Chinese overseas foreign direct investment (OFDI). Apart from the fact that various authors use different sources of data, an important reason for contradictory results is the fact that each author tests host-CSA through different indicators. Here, we propose a list of variables and indicators based on the ‘double diamond ’ model and test these empirically. Originality/value: IB researchers should start conducting serious studies on home-CSAs and host-CSAs instrumental to attracting investments, defining clear indicators and using replicable data base