Showing papers in "Journal of International Business Studies in 2002"
TL;DR: In this paper, the extent and content of businesses' communications about corporate social responsibility (CSR) in France, the Netherlands, the U.K., and U.S. were compared.
Abstract: The paper compares the extent and content of businesses’ communications about corporate social responsibility (CSR) in France, the Netherlands, the U.K., and the U.S. In particular, the study investigates the nature of CSR principles, processes, and stakeholder issues discussed in web pages. The results show that businesses in the four countries do not display the same eagerness to appear as socially responsible and employ diverse means to convey social responsibility images.
1,307 citations
TL;DR: In this article, the authors examined the impact of corruption on foreign direct investment (FDI) and found that foreign investors generally avoid corruption because it is considered wrong and it can create operational inefficiencies.
Abstract: This study examines the impact of corruption on foreign direct investment (FDI). First, the level of corruption in the host country is analyzed. Second, the absolute difference in the corruption level between the host and home country is examined. The analysis provides support for the negative impacts of both. The results suggest that foreign investors generally avoid corruption because it is considered wrong and it can create operational inefficiencies.
1,224 citations
TL;DR: In this paper, the authors examine foreign market entry mode choice and firm performance for a sample of European Union firms and determine if firms that select their entry mode based on transaction cost, institutional context, and cultural context variables perform better than firms that make other mode choices.
Abstract: In this study, we examine foreign market entry mode choice and firm performance for a sample of European Union firms. Examining both financial and non-financial performance measures, we attempt to determine if firms that select their entry mode based on transaction cost, institutional context, and cultural context variables perform better than firms that make other mode choices. We found that mode choice did matter. Firms whose mode choice could be predicted by the extended transaction cost model performed significantly better, on both financial and non-financial measures, than did firms whose mode choice could not be predicted by the extended transaction cost model. Implications for future research are discussed.
1,066 citations
TL;DR: In this paper, the impact of multinationality on both financial and operational performance is moderated by a firm's R&D and marketing capabilities, based on a time series cross-sectional analysis of firms from 12 different industries over a seven-year period.
Abstract: Researchers in international business have long been interested in understanding the relationship between the multinationality of a firm and its market performance. This article contributes to this research stream by incorporating firm heterogeneity in examining the multinationality-performance relationship. The findings, based on a time series cross-sectional analysis of firms from 12 different industries over a seven-year period, indicate that the impact of multinationality on both financial and operational performance is moderated by firm's R&D and marketing capabilities.
643 citations
TL;DR: In this paper, the authors examined several hypotheses regarding the location choice of foreign direct investment from newly industrialized economies (NIEs) using a sample of 328 Taiwanese firms in the analysis, and found that the firms' motivations had a significant impact on the choice of their investment location (developed countries vs less developed countries), yet this impact was moderated by the capabilities of the firms possessed.
Abstract: This study examined several hypotheses regarding the location choice of foreign direct investment from newly industrialized economies (NIEs). Using a sample of 328 Taiwanese firms in the analysis, this study found that the firms’ motivations had a significant impact on the choice of their investment location (developed countries vs. less developed countries), yet this impact was moderated by the capabilities that the firms possessed. The results suggest that both asset-exploitation and asset-seeking aspects of investments are predictive of the NIE firms’ location choice of investment.
637 citations
TL;DR: In this paper, the impact of FDI on the performance of Chinese locally owned firms in manufacturing is investigated, and the authors conclude that the amount of FII will underestimate its overall consequences if spillover effects are significant.
Abstract: Recent years have witnessed the emergence of China as one of the most important destinations for foreign direct investment (FDI), which reached US$403.98 billion by the end of 1999 (MOFTEC, 2000). China is now the largest recipient of FDI in the developing world. However, the amount of FDI will underestimate its overall consequences if spillover effects are significant (Murphy, 1992; O’Malley, 1994; Buckwalter, 1995). This study investigates the impact of FDI on the performance of Chinese locally owned firms in manufacturing.
569 citations
TL;DR: In this article, the authors developed a reconceptualization and operationalization of the concept of psychic distance that broadens the concept and empirically tested this operationalization and investigated the relationship between psychic distance and organizational performance.
Abstract: We develop a reconceptualization and operationalization of psychic distance that broadens the concept. We then empirically test this operationalization and investigate the relationship between psychic distance and organizational performance. Our results suggest that psychic distance, as a summary construct, explains a significant proportion of the variance in financial performance and strategic effectiveness. However, disaggregation of the construct substantially increases its explanatory power. The results also support a psychic distance paradox, where psychic distance has a positive relationship with organizational performance.
526 citations
TL;DR: In this paper, the authors present evidence that international animosity and consumer ethnocentrism are distinct constructs that play different roles depending on the set of products available to consumers, and they find that animosity toward a foreign nation is related to choices between foreign goods.
Abstract: This paper presents evidence that international animosity and consumer ethnocentrism are distinct constructs that play different roles depending on the set of products available to consumers. Results show that animosity toward a foreign nation is related to choices between foreign goods, while consumer ethnocentrism is related to choices between domestic and foreign goods. Further, the study finds animosity effects even though anger levels are generally low, thus extending the boundaries of the animosity model of foreign purchase. The study focuses on U.S. consumer views of Japan and Japanese products. Implications for decisions concerning global versus local branding strategies are discussed.
501 citations
TL;DR: In this paper, the authors compare the predictions of transaction cost and institutional theories in an empirical study of the entry mode choice for 1,194 Japanese foreign subsidiaries, and find support for institutional isomorphism, as later entrants tended to follow the entrymode patterns established by earlier entrants.
Abstract: This paper compares the predictions of transaction cost and institutional theories in an empirical study of the entry mode choice for 1,194 Japanese foreign subsidiaries. The findings indicate the institutional model adds significant explanatory power over and above the predictions of the transaction cost model. Using the concepts of frequency-based, trait-based and outcome-based imitation, I find support for institutional isomorphism, as later entrants tended to follow the entry mode patterns established by earlier entrants. Isomorphic behavior was also present within a firm, as firms exhibited consistency in entry mode choices across time. Further, a firm's investment experience moderated institutional influences on entry mode choice.
483 citations
TL;DR: The authors suggests that the international business research agenda is running out of steam after a period of vibrancy and that the big research question with which international business researchers are engaged is no longer clear cut and that, after three distinct periods where a definite research agenda was pursued, no distinctive topic has emerged to take the place of the issues previously successfully tackled.
Abstract: This research note suggests that the international business research agenda is running out of steam after a period of vibrancy. It suggests that ‘the big research question’ with which international business researchers are engaged is no longer clear cut and that, after three distinct periods where a definite research agenda was pursued, no distinctive topic has emerged to take the place of the issues previously, and largely successfully, tackled.
468 citations
TL;DR: This paper found that countries with high scores on the cultural dimensions of "conservatism" and "mastery" tend to have lower corporate debt ratios, even after accounting for differences in economic performance, legal systems, financial institutions, and some other factors.
Abstract: Why does knowing the nationality of the company help predict its financial leverage? Differences in institutional backgrounds provide only a partial answer to this question. This study suggests that national culture affects corporate capital structures. Empirical hypotheses, drawn from financial models and cross-cultural psychology, are tested against a sample of 5591 firms across 22 countries. Results show that countries with high scores on the cultural dimensions of “conservatism” and “mastery” tend to have lower corporate debt ratios. The effects are strong and remain significant even after accounting for differences in economic performance, legal systems, financial institutions, and some other well-known determinants of debt ratios.
TL;DR: The authors examined the effect of dimensions of national and organizational culture differences on international joint venture (IJV) performance and found that the presumed negative effect from culture distance on IJV performance originates more from differences in organizational culture rather than differences in national culture.
Abstract: This study examines the effect of dimensions of national and organizational culture differences on international joint venture (IJV) performance. Based on data from a survey of executives from joint ventures between Indian partners and partners from other countries, we found that the presumed negative effect from culture distance on IJV performance originates more from differences in organizational culture than from differences in national culture.
TL;DR: In this paper, the authors extended the study of market orientation into the international arena by developing and testing hypotheses relating to the antecedents to and consequences of market-oriented activities in firms' export operations.
Abstract: This paper extends the study of market orientation into the international arena by developing and testing hypotheses relating to the antecedents to and consequences of market-oriented activities in firms’ export operations. Export experience, export dependence and coordinating capabilities were found to be positively related to export market-oriented activities. In turn, export market-oriented activities were positively associated with aspects of export performance.
TL;DR: In this paper, the authors examine issues of level in the study of joint venture trust and explain how international joint venture (IJV) trust can be conceptualized and measured at the person, group, and firm levels.
Abstract: This article examines issues of level in the study of joint venture trust. In particular, we explain how international joint venture (IJV) trust can be conceptualized and measured at the person, group, and firm levels. To do this, we (1) provide a definition of IJV trust applicable to persons, groups, and firms, (2) promote alignment of levels of theory and measurement through the use of a 3×3 approach to guide researchers in identifying the level at which they are theorizing and the proper level of measurement, and (3) propose operational measures of IJV trust across levels and dimensions in order to lay a solid foundation for theory testing.
TL;DR: In this paper, the authors proposed and tested a model that explains how commitment develops and its impact on performance in cross-cultural interorganizational relations, and found that transaction specific investments by the importer and exporter opportunism affect importer commitment, and environmental volatility and cultural sensitivity are indirectly associated with commitment through opportunism.
Abstract: Much of the recent literature on interorganizational relations provides evidence that relationship commitment can produce significant benefits for firms. Somewhat surprisingly, limited attention has been devoted to the role that commitment plays in international buyer-seller associations. Merging findings from the international business and transaction cost economics literature, we propose and test a model that explains how commitment develops and its impact on performance in cross-cultural interorganizational relations. A sample of 216 overseas distributor–manufacturer relationships provides the empirical setting for this research. The findings suggest that transaction specific investments by the importer and exporter opportunism affect importer commitment, and that environmental volatility and cultural sensitivity are indirectly associated with commitment through opportunism. Most important, the study reveals that an importer's commitment has a positive impact on its performance in the relationship. However, no relationship is established between environmental volatility and commitment. The implications of the study are discussed, along with limitations and directions for future research.
TL;DR: In this article, a study of 126 CEO successions and 271 foreign market entry events examines the relationships between successor CEO characteristics and choice of entry mode. But these relationships were observed in the subgroup of high-performing firms but not in the low-performing subgroup.
Abstract: Based on the upper echelons theory, this study of 126 CEO successions and 271 foreign market entry events examines the relationships between successor CEO characteristics and choice of entry mode. Results indicate that CEO position tenure, throughput functional background, and international experience are associated with full-control entry modes. Additionally, these relationships were observed in the subgroup of high-performing firms but not in the low-performing subgroup.
TL;DR: In this paper, the authors developed a theoretical framework based on the "organizational capability" perspective to explain the choice between two non-equity modes (franchising and management-service contracts).
Abstract: Many studies have examined the choice between different types of equity and non-equity modes; however, none has focused on the choice between different types of non-equity modes that service firms employ routinely. This study develops a theoretical framework based on the “organizational capability” perspective to explain the choice between two non-equity modes— franchising and management-service contracts. While previous studies are based on the premise that foreign market entrants choose a mode—equity or non-equity—that offers them most control given their particular circumstances, the premise of this study is that foreign entrants choose a non-equity mode that, in addition, offers effective transfer of the firm's capabilities to the host-country venture.
TL;DR: In this paper, the authors test whether national cross cultural differences between joint venture parents affect JV longevity by comparing that of two categories of JVs placed in the same environment, those between two or more Japanese parents on one hand, and those between Japanese and American parents, on the other.
Abstract: In this paper we test whether national cross cultural differences between joint venture (JV) parents affect JV longevity by comparing that of two categories of JVs placed in the same environment, those between two or more Japanese parents on one hand, and those between Japanese and American parents, on the other. Carefully controlling for other factors that may affect JV longevity, we find that the longevity of Japanese-American JVs is lower than that of Japanese-Japanese JVs. Such effects, however, appear only for dissolutions that result from the sale of the venture to one of the partners, not for those due to liquidation or sale to a third party.
TL;DR: Goals in use of successful businesspersons were rated by over 1,800 junior managers and professionals, attending evening MBA courses at local universities in 15 countries as mentioned in this paper, and a hierarchical cluster analysis of perceived goals divided the countries into seven clusters.
Abstract: Goals-in-use of successful businesspersons were rated by over 1,800 junior managers and professionals, attending evening MBA courses at local universities in 15 countries. A hierarchical cluster analysis of perceived goals divided the countries into seven clusters. The relative ordering of goals within these clusters suggested seven different archetypal business leader roles. Perceptions correlated significantly with national wealth, as well as with dimensions of national culture.
TL;DR: This paper found that while performance satisfaction increased when Chinese exporters used a branding product strategy, branding products and targeting other less developed countries with these brands significantly increased performance satisfaction over branding alone.
Abstract: Does following a product strategy of price leadership result in superior performance satisfaction for Chinese exporters? Does branding products and targeting less developed countries significantly improve Chinese exporters' satisfaction with export performance? Results indicate performance satisfaction decreased when Chinese firms pursued price leadership product strategies. While performance satisfaction increased when Chinese exporters used a branding product strategy, branding products and targeting other less developed countries with these brands significantly increased performance satisfaction over branding alone.
TL;DR: The authors analyzed how market barriers and firm capabilities affect multinationals' choice of joint ventures versus wholly-owned subsidiaries in the US and found that marketing variables are more influential than technological factors in determining the choice of partial versus full ownership.
Abstract: This study analyzes how market barriers and firm capabilities affect multinationals' choice of joint ventures versus wholly-owned subsidiaries abroad. In the study, we compile a vector of variables that distinguish between industry-specific barriers and firm-specific capabilities to analyze Japanese investors' ownership decisions in the US. Our results in general support the hypothesis that Japanese investors facing high market barriers in the target industry are more likely to choose joint ventures, while those possessing strong competitive capabilities are more likely to set up wholly-owned subsidiaries. Specifically, marketing variables are more influential than technological factors in determining the choice of partial versus full ownership. These findings, however, vary across sub samples that represent low- versus high-tech industries and consumer versus industrial products.
TL;DR: In this paper, the authors present a transaction costs analysis of the firm size and export intensity relationship and find that relation-specific investments and the costs of safeguarding these investments play a significant role in export relationships.
Abstract: This paper presents a transaction costs analysis of the firm size and export intensity relationship. We submit that relation-specific investments and the costs of safeguarding these investments play a significant role in export relationships. Firm size related differences with respect to these factors are used to explain the different relationships between firm size and export intensity that have been found in previous studies. The theoretical framework is tested empirically, and support is found for different industries.
TL;DR: In this article, the authors proposed a framework that consists of firm-specific factors, industry/market factors, and host country factors to explain the timing of entry of firms in international markets.
Abstract: This study attempts to explain the timing of entry of firms in international markets. Based on the existing literature, we propose a framework that consists of firm-specific factors, industry/market factors, and host country factors. Empirical results, based on the entry information of U.S. Fortune 500 firms in China between 1979 and 1996, show that larger firms with greater level of internalization and scope economies are likely to enter this foreign market earlier. In addition, non-equity modes, competitors' behavior in the product market, and lower levels of country risk are significantly associated with early entry.
TL;DR: In this article, the effects of institutional forces on change schemas of senior managers, mid-level managers and front-line workers of different types of firms in China are examined.
Abstract: This paper examines the effects of institutional forces on change schemas of senior managers, mid-level managers and front-line workers of different types of firms in China. We postulate that several socio-economic forces including regional economic prosperity, firm type (state-owned and foreign-invested), within-firm ranks, and organizational cultures are at work. The cognitive differences among people in local and foreign firms operating in similar contexts are examined. Through a survey of 3,960 managers and workers we test hypotheses that relate various institutional forces on how individuals perceive, evaluate and infer future changes that challenge them. We also examine the effects of individual change schema on firm commitment and job satisfaction, two indicators that may mediate future changes in these firms.
TL;DR: In this article, the authors evaluate the major international business theories to identify the variables affecting the growth of e-commerce corporations and extend the explanatory power of the eclectic paradigm not only by interpreting the paradigm in the context of E-business, but also by including an element of network-based advantages to the OLI-configuration.
Abstract: The emergence of the Internet has created a dynamic electronic marketplace, where a new species of e-commerce corporations are taking root. However, the factors affecting the growth of these e-commerce corporations is a relatively unexplored area in international business. This study contributes to the international business literature in two significant ways. First, it attempts to critically evaluate the major international business theories to identify the variables affecting the growth of e-commerce corporations. Second, the proposed framework in the study extends the explanatory power of the eclectic paradigm not only by interpreting the paradigm in the context of e-business, but also by including an element of network-based advantages to the OLI-configuration.
TL;DR: The authors examined the amount and type of international research in 19 top management journals from 1976 to 1980 and again from 1996 to 2000 and found that many management journals are increasing their international content while others are not.
Abstract: As business becomes more international, have academic journals, particularly management journals, followed suit? In this paper we examine the amount and type of international research in 19 top management journals from 1976 to 1980 and again from 1996 to 2000. International business studies are classified as multinational enterprise (MNE) research and comparative research. Although the amount and type of international content varies by journal, it appears that many management journals are increasing their international content while others are not.
TL;DR: This paper found that cultural groups responded differently to low job satisfaction with exit, voice, loyalty, or neglect, and that culture moderated the effect of quality of job alternatives and job satisfaction on exit and loyalty.
Abstract: This article reports the results of a field study that evaluated behavioral responses to low job satisfaction of participants in Hong Kong and New Zealand. Culture, measured by vertical and horizontal individualism and collectivism, had both main and moderating effects on responses. First, cultural groups responded differently to low job satisfaction with exit, voice, loyalty, or neglect. Second, culture moderated the effect of quality of job alternatives and job satisfaction on exit and loyalty, and moderated the effect of quality of job alternatives on voice.
TL;DR: In this paper, the authors investigated the mechanics of the identification process of international joint ventures (IJVs) and found that strong ties tend to be shorter and provide a more robust basis for inter-partner cooperation.
Abstract: Partner identification is an important and under-studied precursor to selection and eventual performance of international joint ventures (IJVs). The mechanics of the identification process were investigated in-depth across a sample of eighteen Sino-Hong Kong IJVs using the case study research method. The cross-case findings of this exploratory investigation support the idea that social networks provide a valuable resource for reducing IJV partner search costs. Specifically, the findings reveal that while weakly-linked bridge ties are valuable in identifying potential partners, searches based on strong ties tend to be shorter and provide a more robust basis for inter-partner cooperation.
TL;DR: In this article, the authors combine the literatures on international business-government interactions and on multinational corporations, with resource dependence theory as a foundation, and develop and test hypotheses on factors that might influence the degree to which subsidiary political activities are integrated with affiliated organizations.
Abstract: Just as the competitive activities of MNC subsidiaries exhibit differentiation as well as integration, so might MNC political activities. This paper combines the literatures on international business-government interactions and on multinational corporations, with resource dependence theory as a foundation. We develop and test hypotheses on factors that might influence the degree to which subsidiary political activities are integrated with affiliated organizations. We find that subsidiary strategic integration and the economic integration of the host country significantly influence integration of subsidiary political activities.
TL;DR: In this article, the authors argue that the nature and extent of the benefits that FDI confers on host economies depends in part on the degree of autonomy enjoyed by subsidiary management, and that the more integrated the subsidiaries in the global activities of the parent, the less their autonomy implies limits to their contribution to the Malaysian economy.
Abstract: This paper argues that the nature and extent of the benefits that FDI confers on host economies depends in part on the degree of autonomy enjoyed by subsidiary management. Survey evidence of multinational subsidiaries in Malaysia indicates that the autonomy conferred on local management is limited. Even where subsidiary management categorise their organisations as “decentralised”, their autonomy is limited to local operational matters. In general, the more integrated the subsidiaries in the global activities of the parent, the less their autonomy, which implies limits to their contribution to the Malaysian economy.