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Showing papers in "Journal of International Business Studies in 1985"


Journal ArticleDOI
TL;DR: In this article, the results of an extensive empirical study of the export strategies of a large sample of high technology electronics firms, and the performance results of adopting alternate export strategies were identified.
Abstract: Export sales are an important route to growth for the small-to-medium sized firm This article reports the results of an extensive empirical study of the export strategies of a large sample of high technology electronics firms, and the performance results of adopting alternate export strategies Six strategy scenarios were identified The results show that the types of foreign markets selected, segmentation strategies and product strategies all have a pronounced impact on export sales and export growth The best performers—a group of firms called the “world marketers” and representing 135% of the sample—achieved a dramatic 188% annual growth in exports and exported 525% of their output The profiles of firms that elected each strategy scenario were determined also

510 citations


Journal ArticleDOI
TL;DR: In this article, the choice between licensing and direct investment as a vehicle for international technology transfer is hypothesized to be related to characteristics of the individual technology, parent corporation, and the host country involved in the transfer.
Abstract: The choice between licensing and direct investment as a vehicle for international technology transfer is hypothesized to be related to characteristics of the individual technology, parent corporation, and the host country involved in the transfer. A set of hypotheses regarding these relationships are developed and tested in a logit statistical model for a sample of 1,226 technology transfers. We find that hypotheses regarding the effects of technology and parents characteristics are strongly supported by this analysis; hypotheses regarding the effect of host country characteristics on transfer patterns receive mixed support.

407 citations


Journal ArticleDOI
TL;DR: In this paper, the authors focus on the export expansion process of small and middle-sized manufacturing firms and some of its correlates: diversification and geographical market distribution, means of acquiring information and modes of international distribution.
Abstract: The research focuses on the export expansion process of small and middle-sized manufacturing firms and some of its correlates: diversification and geographical market distribution, means of acquiring information and modes of international distribution. The study reveals the overwhelming influence on export expansion of information acquired from business transactions as opposed to reliance on private or public information services. The impact of market diversification and its nature is confirmed. Policy implications are suggested.

298 citations


Journal ArticleDOI
TL;DR: In this article, the effect of political events on the manufacturing direct foreign investment (MDFI) decisions of U.S. multinational corporations was examined through regression analysis of pooled time-series and cross-sectional (24 countries) data and through various tests of the homogeneity of the relationship across groups of countries.
Abstract: This paper examines the effect of political events on the manufacturing direct foreign investment (MDFI) decisions of U.S. multinational corporations. The relationship between political events (and nonpolitical factors) and MDFI is investigated through regression analysis of pooled time-series (21 years) and cross-sectional (24 countries) data and through various tests of the homogeneity of the relationship across groups of countries. The study finds that the relationship between political events in MDFI is different for less developed countries as opposed to developed countries. For the less developed countries, both inter-nation and intra-nation conflict and cooperation affect MDFI. In contrast, U.S. MDFI in developed countries appears to be affected only by inter-nation conflict and cooperation.

282 citations


Journal ArticleDOI
TL;DR: In this paper, the processes of business negotiations in three countries, the United States, Japan, and Brazil, are compared and contrasted, and observed differences provide the basis for hypothesized differences which might be tested in future work.
Abstract: The processes of business negotiations in three countries, the United States, Japan, and Brazil, are compared and contrasted. Three dyads from each country were videotaped during a buyer-seller negotiation simulation. Both verbal behaviors and nonverbal behaviors were observed and recorded. Observed differences provide the basis for hypothesized differences which might be tested in future work.

235 citations



Journal ArticleDOI
TL;DR: The authors identified five factors that cluster belief about the importance of barriers to export held by executives in strategic business units involved in export of paper products or contemplating such export, and evaluated these factors in respect to the international business literature and labeled as national export policy, comparative marketing distance, lack of export commitment, exogenous economic constraints, and competitive rivalry.
Abstract: This paper identifies five factors that cluster belief about the importance of barriers to export held by executives in strategic business units involved in export of paper products or contemplating such export. These factors were evaluated in respect to the international business literature and labeled as national export policy, comparative marketing distance, lack of export commitment, exogenous economic constraints, and competitive rivalry. This analysis revealed a minor appreciation of the importance of competitive rivalry and a high appreciation of the barrier provided by exogenous economic constraints. The other three factors assumed intermediate positions of importance among the five factors.

190 citations


Journal ArticleDOI
TL;DR: In this paper, the authors argue that the same considerations that go into the positioning strategy in the home country are directly relevant for international markets, and that the effect of country stereotype will be to shift the position of the product in the perceptual space and alter the overall evaluation of its merits.
Abstract: One of the cornerstones of a firm's marketing strategy in any market is the development of an appropriate product positioning plan. This paper argues that may of the same considerations that go into the positioning strategy in the home country are directly relevant for international markets. There is an added elements of complexity in that the country-of-origin of the imported product will often be a salient factor in the buyer evaluation process. The effect of country stereotype will be to shift the position of the product in the perceptual space and alter the overall evaluation of its merits. The competitive strength of the product will thus be affected by country biases. The paper shows how these factors can be dealt with in the management of the “international product positioning” task.

102 citations


Journal ArticleDOI
TL;DR: In this article, the effect of structuring the export arrangement as a contractual, administrative, or conventional channel is analyzed based on data collected from a national sample of export management companies, and the central role of structure in the operation of export channels is largely confirmed.
Abstract: The association between contractual arrangement and the marketing practices of export intermediaries and domestic supplies is examined. Based on data collected from a national sample of export management companies, the effect of structuring the export arrangement as a contractual, administrative, or conventional channel is analyzed. Prior research suggests that contractual form establishes the framework within which all the economic and sociopolitical interactions between the supplier and export middleman take place. Hypothesized relationship between export practices and channel structure are empirically tested, and the central role of structure in the operation of export channels is largely confirmed.

94 citations


Journal ArticleDOI
TL;DR: In this article, the authors describe a model of foreign exchange exposure, defined as the sensitivity of a specific investment's value in reference currency to changes in exchange rate forecasts, which may result because some share of the investment cash flows are denominated in foreign currency.
Abstract: The paper describes a model of foreign exchange exposure. This is defined as the sensitivity of a specific investment's value in reference currency to changes in exchange rate forecasts. This sensitivity may result because some share of the investment cash flows are denominated in foreign currency. Alternatively, a share of cash flows denominated in reference currency which are affected by future exchange rates can also generate sensitivity.

85 citations


Journal ArticleDOI
TL;DR: In this article, the authors examined the unique institutional relationships and the nature of debt and equity claims that are central to understanding financial risk in Japan and reported the results of empirical testing of the types of measures that more accurately reflect bankruptcy risk in large Japanese firms.
Abstract: Financial structure and the nature of financial risk in Japanese companies differ substantially from those of U.S. firms. As a result, the application of U.S. standards is likely to produce misleading conclusions for creditors, investors and competitors. This article examines the unique institutional relationships and the nature of debt and equity claims that are central to understanding financial risk in Japan. It reports the results of empirical testing of the types of measures that more accurately reflect bankruptcy risk in large Japanese firms. The findings indicate that measures of a company's social importance and the strength of its bank relationship may be more important at financially crucial moments than accounting information. The results are of practical value to foreign creditors and analysts, as well as to researchers.

Journal ArticleDOI
TL;DR: This paper found that the choice between related and unrelated acquisitions bears little relation to the acquire's base activity in the U.S., but it is somewhat affected by transaction costs and the firm's previous experience in the host country.
Abstract: What explains the multinational conglomerate, diversified across both product and geographic boundaries? From a sample of diversifying foreign acquisitions by U.S. firms, we conclude that the choice between related and unrelated acquisitions bears little relation to the acquire's base activity in the U.S., but it is somewhat affected by transaction costs and the firm's previous experience in the host country. The motive of risk-spreading encourages unrelated overseas acquisitions.

Journal ArticleDOI
TL;DR: The general hypothesis examined in this article is that global-scale MNEs operate in a regio-or geocentric fashion with full integration of the world pool of managerial resources for all international transfers.
Abstract: Global-scale MNEs require a network of managers to direct and control operations around the world Managerial resources for these jobs can be managers from the headquarters country, host and third countries International transfers can be for specific staffing needs, for management development and for organization development The general hypothesis examined in this paper was the global scale MNEs would operate in a regio-or geocentric fashion with full integration of the world pool of managerial resources for all international transfers Case studies were done on two North American and two European MNEs in the chemicals and electronics industries World-wide transfers and consequent career opportunities were found in all cases for managers from headquarters countries Regional transfers and careers were possible for host and third-country managers in regio-centric MNEs, but only national careers were possible in a poly-centric MNE Temporary transfers to world or regional headquarters for management development were found for host and third-country managers, but transfers for organization development were for headquarters nationals No consistent differences in uses of transfers or international careers were found between North American and European MNEs

Journal ArticleDOI
TL;DR: The authors investigate differences in the use of managerial accounting tools across different national environments, using case studies and anecdotal evidence to support various conjectures, and find that the case study approach is either a case study of actual practices for a small group of firms, or a distillation from numerous observations but using anecdotal evidence.
Abstract: Recently researchers have begun to investigate issues of differences in the use of managerial accounting tools across differing national environments. Much of this research is of the case study approach documenting actual practices for a small group of firms, or a distillation from numerous observations but using anecdotal evidence to support various conjectures.

Journal ArticleDOI
TL;DR: The Editors of the Journal of International Business Studies (JIBS) always try to publish the best international business research as discussed by the authors, but there will probably never be a simple response to the question, What constitutes excellent international business business research?
Abstract: The Editors of the Journal of International Business Studies (JIBS) always try to publish the best international business research. Unfortunately, there will probably never be a simple response to the question, What constitutes excellent international business research? We might make some progress, however, if we first attempt to define international business research and then identify several noteworthy examples.

Journal ArticleDOI
TL;DR: In this article, an algebraic model for the negotiations position of each partner in a prospective venture is presented, where a joint venture partner may be compensated by a package involving some return on equity investment plus royalties, plus margins on components or finished product traded with the joint venture corporation.
Abstract: Traditional theory has viewed direct investment, licensing and trade mainly as foreign market-entry alternatives. However, a growing number of overseas ventures are being formed as a mix of the 3 methods, where a joint venture partner may be compensated by a package involving some return on equity investment, plus royalties, plus margins on components or finished product traded with the joint venture corporation. This paper presents an algebraic model for the negotiations position of each partner in a prospective venture. The trade-offs between the 3 compensation types are complex as they involve non-zero-sum games. The methodology is extended to enable a host government to calculate for each alternative arrangement, the foreign exchange cost, tax revenues, or other national costs and benefits. The model makes some unconventional recommendations for corporate strategy and government policy.

Journal ArticleDOI
TL;DR: This article examined the opportunities and constraints facing Western multinational companies which invest in Joint Ventures in Yugoslav industry and provided empirical evidence drawn from a sample of 42 West European and North American companies addressing itself to the formation and success of Joint Ventures, the route to foreign direct investment in Yugoslavia and motives and preferences for Joint Ventures to other forms of industrial cooperation.
Abstract: Yugoslavia's post-1965 economic policies have been directed towards opening the economy to foreign trade and encouraging inward investment in Joint Ventures. This research examines the opportunities and constraints facing Western multinational companies which invest in Joint Ventures in Yugoslav industry. The empirical evidence drawn from a sample of 42 West European and North American companies addresses itself to the formation and success of Joint Ventures, the route to foreign direct investment in Yugoslavia and motives and preferences for Joint Ventures to other forms of industrial cooperation.

Journal ArticleDOI
TL;DR: In this article, a cross-national researcher is cautioned about the possible consequences of using monetary incentives in foreign mail surveys, and a US$1 incentive increased the response rate from Japanese business people, but decreased the response from Hong Kong.
Abstract: The cross-national researcher is cautioned about the possible consequences of using monetary incentives in foreign mail surveys. In this study, a US$1 incentive increased the response rate from Japanese business people, but decreased the response from Hong Kong.

Journal ArticleDOI
TL;DR: This article examined the reaction of the foreign exchange market to the announcement of changes in the business environment of a country and found that sampled political risk news conveys important information about a country's investment climate and causes its currency's exchange rate to vary.
Abstract: This paper examines the reaction of the foreign exchange market to the announcement of changes in the business environment of a country. Our results suggest that sampled political risk news conveys important information about a country's investment climate and causes its currency's exchange rate to vary. It appears, however, that the reaction of the foreign exchange market is more dramatic for unfavorable events than for favorable events. The evidence presented is also consistent with the hypothesis that the foreign exchange market is efficient in interpreting the type of event considered in this study.

Journal ArticleDOI
TL;DR: In this article, the imperfect competition theory is used to explain six major multinational firm decisions (for example, production location and market servicing methods) with a simple model, which can be extended to explore other important issues.
Abstract: The multinational firm, as the central actor in international business, has been studied extensively across countries and intensively within companies. No single theoretical structure can deal with all important aspects of these firms. Nonetheless, some powerful explanatory tools such as the international product cycle and the transactions cost/internalization theory have shed substantial light on MNE activities. The imperfect competition theory presented here explains 6 major MNE decisions (for example, production location and market servicing methods) with a simple model, which can be extended to explore other important issues.

Journal ArticleDOI
TL;DR: In this paper, a recent investigation of the relationship between firm size and exporting is presented, which illustrates how and why neglect of critical conceptual and methodological issues continues to confound research on the impact that firm size has on exporting.
Abstract: This paper examines a recent investigation of the relationship between firm size and exporting. It illustrates how and why neglect of critical conceptual and methodological issues continues to confound research on the impact that firm size has on exporting.

Journal ArticleDOI
TL;DR: In this paper, a portfolio theoretic model which directly incorporates the effect of interdependence among national markets can be used in the analysis of an MNF's explicit location decisions.
Abstract: The purpose of this paper is to show that a portfolio theoretic model which directly incorporates the effect of interdependence among national markets can be useful in the analysis of an MNF's explicit location decisions. A numerical mean-variance portfolio model is developed and applied to the case of geographical expansion of the MNF. While international diversification may not be considered a necessary and sufficient cause for FDI, its effect on firm earnings should not be ignored in the MNF's location decisions.

Journal ArticleDOI
TL;DR: In this paper, the authors developed a leading indicator of external debt servicing vulnerability that would serve as an advance signal of payments interruption, which can be used to test the vulnerability to debtor countries to oncoming debt servicing problems.
Abstract: The main objective of this paper is to develop a leading indicator of external debt servicing vulnerability that would serve as an advance signal of payments interruption. The traditional and widely used ratios of debt servicing capacity, such as the ratio of the balance on current account of debt service payment, and the ratio of external debt to exports among others, primarily measure a country’s current capacity to handle its international obligations. However, they fail to test the vulnerability to debtor countries to oncoming debt servicing problems, or to signal in advance an imminent situation of payments interruption.

Journal ArticleDOI
TL;DR: In this article, Czinkota and Johnston show that the stages of internationalization best segment firms with respect to exporting and that the size of a firm as an export determinant is a distant second in usefulness.
Abstract: While it is intuitively logical that different types of firms need different types of export assistance, the difficulty comes in developing and testing various approaches to segmenting firms for export development purposes. To date, four types of possible segmentation schemes have been developed in the export assistance literature. One deals with grouping firms according to their size. The others segment firms by grouping them into various international stages according to their export experience,by attitudes of management within the firms, and by the degree to which firms are product or manufacturing oriented. In research reported earlier (Czinkota and Johnston 1981), we have empirically tested each of these approaches and found that the stages of internationalization best segment firms with respect to exporting. The size of a firm as an export determinant is a distant second in usefulness. Yet the effect of the structural variable of firms' size on exporting is worth continued research because current policy uses size as the criterion for export promotion assistance.

Journal ArticleDOI
TL;DR: In this article, the authors suggest that would-be U.S. trading companies could emulate Japan's special, rather than general, trading companies by offering narrow high-margin product lines in geographically diversified markets, integration with manufacturing operations having strong domestic markets, well capitalized finances with access to ample credit, perhaps achieved through partnership with large international banks, efficient working capital management consisting of liberal but controlled trade credit and tight inventories.
Abstract: Analysis of Japanese trading companies suggests that would-be U.S. trading companies could be emulate Japan's special, rather than general, trading companies. Factors likely to lead to success are: offering narrow high-margin product lines in geographically diversified markets; integration with manufacturing operations having strong domestic markets; well capitalized finances with access to ample credit, perhaps achieved through partnership with large international banks; efficient working capital management consisting of liberal but controlled trade credit and tight inventories; management experienced in international markets and capable of heeding national interest considerations in many countries; and patience and a long-term outlook, since during client relationships are necessary to achieve profitability.

Journal ArticleDOI
TL;DR: In this article, the authors present statistical evidence supporting the proposition that the kind of monopolistic advantage possessed by a firm is decisive as to which form of involvement it will choose to penetrate into foreign markets: exporting versus producing abroad.
Abstract: The paper presents statistical evidence supporting the proposition that the kind of monopolistic advantage possessed by the firm is decisive as to which form of involvement it will choose to penetrate into foreign markets: exporting versus producing abroad. A decomposition of export flows into exports to affiliates (intra-company trade) and exports to unaffiliated buyers proves to be a crucial element in the empirical test of this proposition.


Journal ArticleDOI
TL;DR: This article examined the currency-of-denomination decision for long-term debt financing in the presence of corporate income taxes and flotation costs and provided convincing evidence that the tax effect dominates the flotation cost effect unless the firm operates in tax haven countries.
Abstract: This paper examines the currency-of-denomination decision for long-term debt financing in the presence of corporate income taxes and flotation costs. The numerical analysis provides convincing evidence that the “tax effect” dominates the “flotation cost effect” unless the firm operates in tax haven countries. Hence, the conventional decision rule still applies to the choice of currency in which to borrow or to lend: Borrow in the weakest currency and lend in the strongest.

Journal ArticleDOI
TL;DR: In this article, the authors present a multi-factor analysis of the determinants of U.S. trade patterns and find that productivity and product development are the principal characteristics of high export percentage business units.
Abstract: As exports become an increasing part of industry sales, the determinants of a firm's international position become increasingly important. Tests have supported single factors, such as, product life cycle [Lutz and Green 1983] as well as multi-factor models, to explain the determinants of industry imports and exports [Stern and Maskus 1981; Harkness and Kyle 1975; Baldwin 1971]. This study also presents a multi-factor analysis of the determinants of U.S. trade patterns. This study utilized the SPI (Strategic Planning Institute) data set which allows research at the business unit (product line) level. Results indicate that productivity and product development are the principal characteristics of high export percentage business units. These findings are especially true for nonconsumer industries. Thus to the degree that business are concerned over the short-term costs of product development, direct or indirect (for example, insurance) government aid may be required to promote U.S. export industries.

Journal ArticleDOI
TL;DR: In this article, an in-depth analysis of the mining companies' annual reports from 1964 through 1981 is presented, showing that the direct revenue loss was over $1 billion through 1981, not counting various disguised costs.
Abstract: The Zambian government's 51% nationalization of the country's copper mines in 1969 was motivated partly for economic purposes—a kind of learning-by-doing was anticipated—and partly for political reasons. It appears that the Zambians did obtain a semblance of managerial control and “national ownership,” but at a very high financial price. The article estimates that the direct revenue loss was over $1 billion through 1981, not counting various disguised costs. The findings are based primarily on an in-depth analysis of the mining companies' annual reports from 1964 through 1981.