This book challenges the widely accepted notion that globalization encourages economic convergence--and, by extension, cultural homogenization--across national borders. A systematic comparison of ...organizational change in Argentina, South Korea, and Spain since 1950 finds that global competition forces countries to exploit their distinctive strengths, resulting in unique development trajectories.
We review the classic theory of the MNE and past attempts to use it to understand the internationalization of firms from emerging markets. We offer two criteria to determine whether EMNEs modify ...classic theory or not: (1) establishing appropriate theoretical reference points, and (2) distinguishing between theoretical constructs and empirical variables. We suggest that the literature can benefit from moving beyond comparing EMNEs to DMNEs and focusing instead on more fruitful issues. Specifically, emerging markets offer the opportunity to observe the origin of the capabilities of MNEs in general and the development of the institutional ecosystem that supports internationalization.
Cross-national distance is a key concept in the field of management. Previous research has conceptualized and measured cross-national differences mostly in terms of dyadic cultural distance, and has ...used the Euclidean approach to measuring it. In contrast, our goal is to disaggregate the construct of distance by proposing a set of multidimensional measures, including economic, financial, political, administrative, cultural, demographic, knowledge, and global connectedness as well as geographic distance. We ground our analysis and choice of empirical dimensions on institutional theories of national business, governance, and innovation systems. In order to overcome the methodological limitations of the Euclidean approach, we calculate dyadic distances using the Mahalanobis method, which is scaleinvariant and takes into consideration the variance-covariance matrix. We empirically analyze four different foreign expansion choices of US companies to illustrate the importance of disaggregating the distance construct and the usefulness of our distance calculations, which we make freely available to managers and scholars.
We investigate how state capacity—the administrative ability to formulate and implement policy—affects the institutional adoption of new policies and the decoupling of those policies from their ...original purpose in the face of pressures from professions, multilateral agencies, and imitation among countries. We expect state capacity to reduce the effect of professional and imitation influences, to increase the impact of coercive effects by multilateral agencies, and to lessen decoupling between policies' adoption and desired outcomes. We tested these predictions using a unique longitudinal dataset on the adoption of minority shareholders' legal protections and the development of the stock market in 78 countries between 1970 and 2011. We found evidence consistent with the moderating effects of state capacity on institutional adoption and on lessening policy–practice decoupling. Our findings suggest that the strength of state capacity influences which policy models policymakers select and adopt, whether they implement them effectively, and what the consequences of such adoption are.
In recent years, venture capital firms have increasingly turned to foreign countries in search of investment opportunities. The cross-border expansion of venture capital firms presents an interesting ...case of internationalization, because they are at variance with both conventional portfolio and direct investment models. Given the specific nature of venture capital investing, a new theoretical perspective is needed to understand foreign venture capital investments. This paper contributes to international business research by examining the features of the institutional environment that influence venture capital firms' foreign market entry decisions, and how their effect changes as firms acquire experience. We report results on 216 American venture capital firms potentially investing in 95 countries during the 1990–2002 period. We find that venture capital firms invest in host countries characterized by technological, legal, financial, and political institutions that create innovative opportunities, protect investors' rights, facilitate exit, and guarantee regulatory stability, respectively. We also find that as firms gain more international experience, they are more likely to overcome constraints related to these institutions.
We argue that the influence of the home country wanes as the firm increases its geographic reach. We introduce the concept of the "home base" to capture the effect of the set of countries in which ...the firm operates. We expect the dynamic liability of foreignness defined relative to the home base to be a better predictor than the static liability of foreignness defined relative to the home country. We also expect the diversity of foreign experience to increase foreign market entry. We find support for these hypotheses with data on Chinese listed firms investing abroad between 1991 and 2007.
We argue that firms in regulated industries react to macroeconomic and policy risks in sharply different ways. While they seek to avoid countries with high levels of macroeconomic uncertainty, we ...predict that they find it more attractive to expand into countries characterized by governments with discretionary policymaking capacities so as to be able to negotiate favorable conditions of entry. We also argue that firms are heterogeneous in their attitudes toward risk. We predict that firms in which the state holds a partial equity stake exhibit a more tolerant attitude. We also expect that as firms accumulate foreign experience, they develop an aversion toward further foreign entries into politically unstable markets. Support for these predictions is provided by an analysis of the Latin American market entries of all listed Spanish firms in regulated industries between 1987 and 2000.
The traditional American model of multinational enterprise (MNE), characterized by foreign direct investment (FDI) aimed at exploiting firm-specific capabilities developed at home and a gradual ...country-by-country appraoch of internationalization, dominated the global economy during much of the post-World Wall II period. In the decades, however, new MNEs from emerging, upper-middle-income, or oil-rich countries have followed completely different patterns of international expansion. In this paper we analyze the process through which these firms became MNEs and to what extent we need a new theory to explain their international growth.
Building a global bank Guillen, Mauro F; Guillen, Mauro F; Tschoegl, Adrian
2008., 20080701, 2008, 2008-07-01, 20080101, c2008
eBook
In 2004, Spain's Banco Santander purchased Britain's Abbey National Bank in a deal valued at fifteen billion dollars--an acquisition that made Santander one of the ten largest financial institutions ...in the world. Here, Mauro Guilln and Adrian Tschoegl tackle the question of how this once-sleepy, family-run provincial bank in a developing economy transformed itself into a financial-services group with more than sixty-six million customers on three continents. Founded 150 years ago in the Spanish port city of the same name, Santander is the only large bank in the world where three successive generations of one family have led top management and the board of directors. But Santander is fully modern. Drawing on rich data and in-depth interviews with family members and managers, Guilln and Tschoegl reveal how strategic decisions by the family and complex political, social, technological, and economic forces drove Santander's unprecedented rise to global prominence. The authors place the bank in this competitive milieu, comparing it with its rivals in Europe and America, and showing how Santander, faced with growing competition in Spain and Europe, sought growth opportunities in Latin America and elsewhere. They also address the complexities of managerial succession and family leadership, and weigh the implications of Santander's stellar rise for the consolidation of European banking.
The authors examine the impact of globalization on state structures in the specific instance of the central bank. Following the world-system, world-society, & neoinstitutional perspectives in ...sociology, they assume that states are in cultural, political, & economic competition with each other, thereby seeking to maintain their position & status, frequently by adopting organizational forms or practices that make them isomorphic with their environment. The authors predict that countries boost the independence of their central bank from the political power as their exposure to foreign trade, investment, & multilateral lending increases. They also model the cross-national dynamic process of diffusion of central bank independence by examining the impact of cohesive & role-equivalent trade relationships between countries. They find support for their hypotheses with information on 71 countries between 1990 & 2000. 4 Tables, 1 Figure, 1 Appendix, 119 References. Adapted from the source document.
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