Over the past 50 years, cooperative forms of governance such as equity joint ventures and other strategic alliances have received tremendous attention in international business and management ...research. This article traces the history of this research over these past five decades with particular emphasis on the critical role that (Columbia) Journal of World Business has played in disseminating scholarly and managerial expertise on the successful management of cross-border, inter-firm collaboration. We highlight the evolution of interest in different contexts, phenomena, theories, and methodologies, along with the factors that have driven interest in these topics. Several suggestions for future research are also provided.
PurposePrior research has found that firms' adoption of digital technologies (i.e. digitalization) enhances transaction efficiency and improves firm performance. However, this finding is based on the ...assumption that firms respond to consumers' adoption of digital technology (market digitalization) in a timely fashion. The study investigates the impact of market digitalization on firm performance in Latin America, where resistance to change is often higher, despite the positive impact on performance when companies respond to the environmental shock of digitalization by restructuring.Design/methodology/approachUsing data from seven Latin American countries from 1997 to 2018 (Argentina, Brazil, Chile, Colombia, Peru, Venezuela and Mexico), fixed-effects panel regression robustly supports the results.FindingsMost Latin American firms fail to capitalize on the benefits of market digitalization, and their performance declines as a result. The authors extend research on digitalization by incorporating theoretical insights from the restructuring literature, finding that implementing a substantial restructuring strategy is a viable way to overcome market digitalization.Originality/valueThe authors demonstrate that the digitalization–firm performance relationship is more complex than has been described in studies using samples from developed economies. The authors establish restructuring as an effective adaptation strategy in Latin America, although the institutional environment's characteristics may constrain or discourage firms from adopting it.
Managing Joint Ventures Beamish, Paul W.; Lupton, Nathaniel C.
Academy of Management perspectives,
05/2009, Volume:
23, Issue:
2
Journal Article
Peer reviewed
Joint ventures aid firms in accessing new markets, knowledge, capabilities, and other resources. yet they can be challenging to manage, largely because they are owned by two or more parent companies. ...These companies may have competing or incongruent goals, differences in management style, and in the case of international business, additional complexities associated with differing government policies and business practices. We examine research on joint venture (JV) performance in order to identify prominent academic discussions established over the last 25 years. From this research, we draw implications from past research and areas for future research on successfully managing JVs, taking into account the decisions JV partners must make throughout the partnering process, from initial motivations through partner selection and negotiation of terms to implementation and ongoing management. Key implications include the necessity of honesty, trust, and commitment for the success of the JV, setting disputes by focusing on what is best for the JV rather than individual partner objectives, and division of managerial responsibilities according to the functional expertise of each partner.
Purpose
The purpose of this paper is to investigate the impact of climate risk on the success vs failure of foreign direct investments (FDIs) in private participation infrastructure (PPI) projects. ...The authors also consider the extent to which project-level characteristics mitigate such risks.
Design/methodology/approach
The authors study a sample from the World Bank covering 18,846 projects in 111 countries from 2004 to 2013. The authors apply logistic regressions to determine the impact of climate risk and mitigating project characteristics on project failure.
Findings
The authors find that higher levels of climate risk at the host country level are associated with higher risk of project failure. The authors also find that the disadvantage of higher climate risk is weakened by two project-level characteristics, namely, the inclusion of host government ownership in the project consortium and the size of the project.
Originality/value
The research contributes to the current debate about the impact of climate risks on international business ventures. The authors demonstrate that climate risk is a locational disadvantage for FDI in PPI projects. The authors establish that the “fittest” projects in locations characterized by higher climate risk tend to be those that involve host government participation in their ownership structure as well as those of larger sizes.
Purpose
This paper aims to investigate the extent to which locating primary industry subsidiaries in politically unstable countries impacts their survival. The authors argue that foreign ...multinational enterprises in less stable political environments can shape policies that are impactful on the costs of operating in primary industries and avoid compliance with more stringent policies at home.
Design/methodology/approach
Using a sample of 753 primary sector investments of Japanese multinational enterprises during the period 1986 to 2013, the authors conduct a parametric survival analysis of the relationship between political stability and subsidiary survival.
Findings
Political instability has a slight, curvilinear relationship with subsidiary survival, such that both high and low stability are associated with lower exit hazard, while moderate levels of stability increased exit hazard. This nonlinear relationship is stronger for efficiency-seeking subsidiaries, and weaker for market-seeking subsidiaries.
Originality/value
This research contributes to the debate around the pros and cons of globalization by examining the extent to which firms benefit by offshoring primary sector investments to avoid more costly legal requirements at home. The results suggest that this non-market strategy should be mitigated through appropriate policy measures and provides evidence that those policies already implemented are effective.
We examine the extent to which host country income inequality influences multinational enterprises’ (MNE) expansion strategy for foreign production investment, depending on their specific strategic ...objectives. Applying a transaction cost framework, we predict that national income inequality has an inverted U-shaped relationship with foreign production investment. As inequality increases, MNEs accrue lower transaction costs arising from interactions with various local actors, leading to higher probability of investment. As income inequality increases further, its effect on location attractiveness will become negative, as its attraction effect is increasingly offset by additional monitoring, bargaining, and security costs owing to the more fractious nature of high inequality societies. In addition, we suggest that the impact of income inequality is contingent on investment objectives: The inverted U-shaped relationship is stronger for efficiency-seeking investment but weaker for market-seeking and competence-enhancing investments. We find substantial support for our hypotheses through an analysis of 27 years (1986-2012) of data on Japanese MNEs’ overseas production entries.
Drawing on the person-organization fit theory, we
investigate how the value congruence between employees' collectivist
values and their perception of organizational collectivism influences
...organizational embeddedness. Based on a survey of 515 working adults, the
polynomial regression and response surface analysis results support that
embeddedness is highest in the presence of both high individual and
organizational collectivism. Additionally, the smaller the discrepancy between
the two perceptions, the more embedded the employees. Our study contributes to
the cultural perspectives in the organizational embeddedness research by
theorizing and measuring the impact of collectivism at the individual level. The
findings also contribute to the person-organization fit theory by
identifying a value congruence approach to organizational embeddedness.
Purpose
Worldwide, Ecuador is one of the countries with the most entrepreneurial activity from micro, small and medium-sized enterprises (MSMEs). However, the effect of adopting the US dollar ...(dollarization), over which the central bank has no control, combined with being mainly an exporter of primary products, as well as strategic currency devaluation by neighboring economies, has created a difficult situation, especially for Ecuadorian women’s MSMEs. This paper aims to study the relationship between female ownership and Ecuadorian MSMEs’ financial, economic and social outcomes.
Design/methodology/approach
The authors compile a near-population panel of 617,804 firm-year observations representing an unbalanced panel of 112,917 MSMEs during the 2007–2016 sampling window. Panel (fixed effects) regression is used to test the hypotheses concerning the antecedents to firm financial performance, economic and social outcomes. Cox proportional hazards modeling is used to assess the impact of antecedents on firm survival.
Findings
First, firms providing more social benefits (e.g. employment and higher wages) have higher survival rates. Second, female ownership is negatively related with microenterprise financial performance, but positively associated with small-enterprise financial performance. Third, female-owned enterprises tend to provide higher wages per employee for all firm sizes. Fourth, although female-owned microenterprises are less efficient, they tend to provide more for their employees and possibly communities, through the economic stimulus they provide, in terms of the size of the financial outcomes.
Originality/value
This paper shows that, although this is a “man’s world,” women are learning earlier, developing faster professionally and overcoming stereotypes to focus on activities that generate both economic performance and social outcomes. Governmental policies that have contributed to MSMEs’ growth and women’s participation are identified. The findings suggest ways to improve and support both the creation of more women-owned MSMEs in emerging countries, such as Ecuador, and the survival of existing male- and female-owned MSMEs.
This paper analyzes the impact of terrorism hazard on the performance of private participation infrastructure projects. Applying transaction cost theory, we hypothesize that terrorism hazard has a ...negative relationship with infrastructure project completion, and that host government accountability and investor experience with terrorism hazard have opposing impacts on this relationship. Host government accountability, we argue, produces higher indirect costs of managing terrorism hazard, which reduces investor confidence, and reinforces the negative relationship between terrorism hazard and the probability of satisfactory project completion. Conversely, investor’s experience with terrorism hazard increases investor confidence and hence partially mitigates the negative consequences of terrorism hazard which hamper project completion. Hence, the impact of terrorism is weakened for projects led by firms from higher terrorism hazard countries. We find support for our hypotheses using a sample of 5,083 projects in 135 countries from 2002 to 2017.
Institutional differences between countries influence strategic choices and performance of international businesses, but the unintended effects of legal institutions on firm legitimacy have received ...less attention. We argue that, while minority shareholder rights protection in an investment location does not directly protect shareholder interests abroad, the normative and mimetic effects it has on host country managers can mitigate agency problems. Using Japanese FDI established between 1986 and 2013 we find that (a) subsidiaries established in host countries with higher shareholder rights protection employ a smaller proportion of Japanese expatriates, (b) shareholder rights protection enhances a country’s FDI attractiveness, and (c) that the impacts of shareholder rights protection on expatriate ratio and location attractiveness are stronger when firm ownership is concentrated among exchange-listed firms. This research contributes to the literature on institutional difference in international business, in particular by highlighting the value of studying the imprinting effects of regulations.
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