Showing papers by "Stockholm School of Economics published in 1988"

The Effect of National Culture on the Choice of Entry Mode

Abstract: Characteristics of national cultures have frequently been claimed to influence the selection of entry modes. This article investigates this claim by developing a theoretical argument for why culture should influence the choice of entry. Two hypotheses are derived which relate culture to entry mode choice, one focusing on the cultural distance between countries, the other on attitudes towards uncertainty avoidance. Using a multinomial logit model and controlling for other effects, the hypotheses are tested by analysing data on 228 entries into the United States market by acquisition, wholly owned greenfield, and joint venture. Empirical support for the effect of national culture on entry choice is found.

‘Development Blocks’ in Industrial Economics

Abstract: The concept development block refers to a set of factors in industrial development which are closely interconnected and interdependent. Some of them are reflected in price and cost signals in markets which are noted by firms and may give rise to new techniques and new products. Some of them come about by firms creating new markets for their products via entrepreneurial activities in other industries. This, too, may include the creation of new techniques and new products. In both cases, incomplete development blocks generate both difficulties and opportunities for firms. This analytical approach can contribute to closing the gap between micro and macro analysis.

International management of R&D: The Swedish Experience

Abstract: This paper summarizes the results of in-depth case studies of international R&D management in four Swedish multinational corporations. The results suggest that foreign volumes and shares of R&D expenditures are rapidly increasing. Through a rapidly increasing number of foreign acquisitions, foreign R&D laboratories have been added. As part of international rationalization of production, foreign units have been given global product mandates with responsibility both for manufacturing and R&D. In maturing foreign subsidiaries, routine technical activities have often evolved into proper R&D. Tight labour market conditions for engineers in Sweden have made it increasingly necessary to exploit existing technical capacity, regardless of location. Concurrently, companies face new pressures for international coordination and control of R&D. Coordination is required to reduce product differentiation, to facilitate technology transfer and to ensure the technical and market compatibility of products and components developed at different locations but sold as part of total systems. Drawing on the experience in the four investigated companies, the paper discusses how systems and procedures can be developed to meet the need for coordinated international R&D management.

The Psychology of Innovative Entrepreneurship

Abstract: Many industrialized countries are somehow losing momentum in their economic development. This seems to be the case with the West European countries and the U.S.A. Lack of entrepreneurial activities is one of the major factors blamed for the negative development. Politicians and mass media in many countries frequently stress the need for innovative entrepreneurship. It is noted that Japanese entrepreneurship has made Japan prosper in an impressive way since the end of the second world war. Great expectations are founded on the possibilities of using the potentials of high technology. High technology industries provide an interesting story of innovative exploitation of research ideas in enterprises that have started out small, but rapidly grown into large complexes. Rogers and Larsen (1986) who have published a study of the rise and continued fortunes of Silicon Valley firms, talk about a Silicon Valley “fever” spreading to nations all over the world and even including the People’s Republic of China.

How to Control Things with Words: Organizational Talk and Control

Abstract: Labels, metaphors, and platitudes are linguistic artifacts that organizational leaders produce, steal, borrow, or buy from consultants for a high price. Studies on organizational change indicate th...

Dynamics of organizational control: the case of berol kemi ab.

Abstract: The paper analyzes changes in organizational control related to changes in an organization's economic situation. The thesis of tightening managerial control as a typical managerial reaction to decline is illustrated by developments in a Swedish company chosen as a case example. The interpretation challenges explanations indicating objective, causative relationships between organizational economy and organizational control. Instead, the focus is placed on social mechanisms, such as the social attribution of causes and the increased need for legitimation on the part of managers. Control and production subsystems are also seen to be loosely coupled.

Economic Psychology as a Field of Study

Abstract: Judging from mass media treatment of economic affairs — be it in a recession, in a more serious depression or in an upswing period — there should be ample room for psychology when economic issues are dealt with. Economists who appear in the public eye as authors of articles or as interviewees often stress the importance of psychological factors. References to psychological factors are primarily made when the factors studied by economists do not suffice to explain certain economic developments. In such contexts, it is characteristic that no reference is made to the existence of scientific psychology and that comments are based on common-sense notions about man. There seems to be little awareness and recognition of the fact that concepts such as expectations, attitudes, preferences, and motivation are actually studied in psychology and that they are considered to be amenable to measurement. Psychology is used by economists to designate factors that create individual variations in economic behavior and that consequently are responsible for making economic behavior hard to predict (cf. Maital, 1982).

Multinational Firms and Manufactured Exports from Developing Countries

Abstract: Multinational firms have played an important role in leading the developing countries into world markets. Multinationals from the United States, Japan and Sweden have all increased their shares of LDC exports of manufactures since the mid-1960s or mid-1970s. Their importance was particularly notable in Latin America, while their role in the Asian NICs decreased. The comparative advantages of U.S. and Swedish multinationals' affiliates in developing countries resembled those of their home countries more than those of their host countries, while Japanese affiliates' exports are lore similar to those of their host countries. There are some cases in which the advantage of the multinationals as exporters seems to be that they are able to combine company comparative advantages with the location advantages of producing in the developing countries.

Social Influence on Economic Behavior

Abstract: Social psychologists stress the fact that human beings are social beings who are dependent on fellow humans for their survival and comfort. Undoubtedly, many behavioral acts and behavior in general are heavily influenced by other people. Psychology can even be seen as only a subdivision within social psychology and it can be held that psychology takes the individuals out of their natural social habitats and studies them in artifactual isolation. The social psychologist Tarde (1902) complained that economics was not based on social interaction but on the individual pursuit of self-interest, and that it disregarded the importance of the social environment for the individual. It is still true that consumer choices of products and brands as well as saving decisions are treated in economic theory as if a single individual were making the decisions.

Prejudices and wishful thinking about computer aided design

Abstract: The findings from a study of the consequences of the introduction of CAD† on the organisation of work in three Swedish engineering companies are consistent with European empirical research but not with the predictions of either the advocates or critics of the technology. Here the author offers two possible explanations.

Research on budgetary control in the nordic countries — A survey☆

Abstract: The paper surveys research on budgetary controls in the Nordic countries of Denmark, Finland, Norway and Sweden. The aim is to illustrate the types of problems and issues that have provided the basis for research, and to highlight those research studies which reflect research perspectives that have originated in the Nordic area. Influences on research in the area are also considered.

The Role of Multinational Corporations in Latin America and Asian Manufactured Exports

Abstract: The last 20 years have witnessed some remarkable structural changes in the world economy. The industrialization process has 'taken off' in several developing countries and we see an increasing importance of the Third World in world exports of manufactured goods today. Although a relatively small number of countries account for most of these exports, the overall figures are impressive, and appear to give cause for optimism about the future growth possibilities for many LDCs. In this paper we examine the role of foreign owned multinational corporations (MNCs) in these developments. If such firms, rather than domestic firms, are responsible for the increases in exports from developings countries, the domesticallyowned industrial base in the Third World has not changed much over the years.In that case, the 'industrialization by invitation', a term Arthur Lewis once coined, may not have resulted in much of an improvement in the domestic firms' innovativeness or inventiveness, in their management abilities, or in their technological capabilities. We distinguish between the export performance of developing countries on the one hand and of foreign owned affiliates operating there on the other, in order to see whether the recent structural changes in the LCDs are domestically based or not. The investigation cover multinationals from the United States and Sweden, and uses recently available surveys of outward investment from these countries. The data are described in Appendix A. Apart from developing countries as a group. we pay special attention to two developing regions (Latin America and the four Newly Industrializing Countries,(NICs) in Asia) and six individual countries (Brazil, Mexico, Hong Kong, Korea, Singapore and Taiwan. These countries receive the bulk of foreign direct investment in manufacturing in the developing countries and they are the main LDC exporters of manufactures. Furthermore, they have very different industrial strategies, which make them suitable for a comparison. Generally speaking, Latin America has followed a more inward looking policy, and has thereby attracted foreign manufacturing investment mainly into protected import-substituting activities, while the Asian NICs have followed a more outward oriented policy, which has lured export-oriented foreign affiliates. The plan of the paper is as follows. The next section examines the export performance of the developing countries since the mid-1960s, first for manufacturing industries as a whole, then for broad industry groups. Section 3 investigates what role U.S. multinationals plays in these exports, and Section 4 extends the analysis to Swedish firms. Finally, Section 5 summarizes and concludes the study.