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Showing papers on "Multinational corporation published in 1972"



Journal ArticleDOI
TL;DR: In this article, the authors present the results of an empirical study of the distinguishing characteristics of United States manufacturing corporations with foreign subsidiaries, and draw some basic inferences about the direct investment process by comparing the characteristics of those firms investing in Canada with those not doing so, of those which are multinational with those which were not, and those who were multinational with other countries.
Abstract: T HIS paper presents the results of an empirical study of the distinguishing characteristics of United States manufacturing corporations with foreign subsidiaries. My conclusions are drawn from two sets of data: the first covers 1191 manufacturing corporations, 576 of which owned a majority interest in a Canadian subsidiary in 1967. My second set of data, a subset of the first, covers Fortune's 500 largest industrial corporations, 187 of which qualified for the "multinational" designation of the Harvard Business School.' I hope to draw some basic inferences about the direct investment process by comparing the characteristics of those firms investing in Canada with those not doing so, of those which are multinational with those which are not, and those which are multinational with those investing in Canada, if not in, six other countries. In order to put the contribution of this paper into proper historical perspective, let me comment briefly on the existing literature on why firms invest abroad. Earlier research has tended to fall into one of two categories: studies of the characteristics of the industries in which foreign investing is comparatively heavy, or studies of the characteristics of the individual firms investing abroad. The industrial studies are far more common (owing largely, one suspects, to the easier access to industry data) and have been thoroughly surveyed in a recent paper by Richard Caves. His conclusions in a nutshell were:

478 citations


Journal ArticleDOI
TL;DR: In this paper, the authors examine the behavior of capital asset prices in the international capital market and show that the behavior is consistent with the one market hypothesis and any one of several specific forms of market segmentation.
Abstract: MOST OF the existing studies on the international capital market are based on a segmented market approach This approach treats the different national capital markets as separated entities, hardly related to each other For this reason (under the assumption of market segmentation), comparable capital assets may differ in their return on different national markets Although market segmentation enjoys a surprisingly large following, it is not the only possible interpretation of the international capital market The alternative hypothesis, ie, that prices of capital assets in the international capital market behave as if there is one multinational perfect capital market, should be considered The one market hypothesis has the advantage of being consistent with much of the accepted economic theory Also the one market hypothesis is unambiguous where market segmentation can stand for any number of specific imperfect market formations Market segmentation is widely accepted as the only possible structure of the international capital market Different currency areas, separated political organizations and trade barriers have been given as a priori evidence for the segmentation of the international capital market This, however, is not necessarily the case An examination of the behavior of capital asset prices reveals that the price behavior is consistent with the one market hypothesis It should be noted, however, that a certain body of data can be consistent with both the one market hypothesis and any one of several specific forms of market segmentation But as the main theme of this study is to show the validity of the one market approach to the multinational equity market, it is sufficient to show that one cannot reject the one market hypothesis with regard to this market

294 citations


Book
01 Apr 1972

124 citations


Book
01 Jan 1972
TL;DR: The International Economy: A Manager's Perspective as discussed by the authors is a manager's perspective of the international economy from the perspective of a company's goals and strategies, as well as its objectives and characteristics.
Abstract: The International Economy: A Manager's Perspective. THE ENTERPRISE FROM WITHIN. Going Multinational: Firm Motives and Characteristics. Case. Lotus Development Corporation: Entering International Markets. Managing the Multinational: Goals and Strategies. Case. Gerber Products Company: Investing in the New Poland. Managing the Multinational: Organizations and Networks. Case. Xerox and Fuji-Xerox. National Units in Multinational Networks. Case. Shell Brasil S.A.: Performance Evaluation in the Oil Products Division. THE ENTERPRISE AND THE NATION. Comparing National Economies. Case. Global Computer Industry. Exploring National Policies. Case. Collision Course in Commercial Aircraft: Boeing-Airbus-McDonnell Douglas (A). THE INTERNATIONAL ENVIRONMENT. The National Economy in an International Setting. Case. Volkswagen de Mexico North American Strategy (A). International Money Markets. Case. CIBA-GEIGY AG: Impact of Inflation and Currency. The International Rules of the Game: Money. Case. Fluctuations. The International Rules of the Game: Goods and Services. Case. Pfizer: Protecting Intellectual Property in a Global Marketplace. Balance of Payments Exercises (TBD) The Foreign Exchange Market: Problem Set (TBD).

80 citations



Journal ArticleDOI
TL;DR: In this paper, the authors present a collection of papers by a distinguished group of scholars on various aspects of the international corporation: theoretical, financial, technological, legal, and political.
Abstract: This volume brings together papers by a distinguished group of scholars on various aspects of the international corporation: theoretical, financial, technological, legal, and political. The book also includes studies of three world industries--petroleum, automobile, and banking--and of three world regions where the international corporation has considerable predominance: Australia, Japan, and Latin America. These wide-ranging forays are brought to conclusion by a summary article on the future of the multinational enterprise, in which Raymond Vernon treats the theory of direct investment and attitudes of home and host countries. He recommends a harmonization of policies toward multinational corporations which would enable them to respond to economic signals related to scarcity rather than to differences in the artificial environment.The high quality of these papers, which were originally given at a symposium in the M.I.T. Sloan School of Management, merits their publication here; and as a stimulus to further research and learning, the editor has made no attempt to eliminate overlap or contradictions. A number of the presentations are informal talks committed to paper, while others are scholarly research. The chapters in each of the six sections reflect individual points of view rather than a single mode of analysis complete with common glossary. Professor Kindleberger remarks that "Much of the contribution of the book consists of putting precisely and between a single set of covers the common intellectual coinage of the field of the international corporation as seen by economists, and to a lesser extent professors of management, practitioners, and political scientists."Contributors Charles P. Kindleberger, Robert Z. Aliber, H. G. Johnson, Stephen Hymer, Robert Rowthorn, H. David Willey, John H. Dunning, Seymour J. Rubin, Kenneth N. Waltz, M. A. Adelman, J. Wilner Sundelson, Julien-Pierre Koszul, Donald T. Brash, Carlos F. Diaz Alejandro, M. Y. Yoshino, and Raymond Vernon.

57 citations


Journal ArticleDOI
TL;DR: The yearly operations of a multinational firm involve a considerable amount of trade between the parent and its subsidiaries as discussed by the authors, and these internal flows include both purchases and sales of raw materials, semi-finished and finished goods, and a wide range of services.
Abstract: The yearly operations of a multinational firm involve a considerable amount of trade between the parent and its subsidiaries. These internal flows include both purchases and sales of raw materials, semi-finished and finished goods, and a wide range of services. They are often the single most important method of effecting capital transfers among the different countries in which the multinational firm operates and comprise an extremely secretive area of decision making.© 1972 JIBS. Journal of International Business Studies (1972) 3, 1–18

48 citations




Journal ArticleDOI
TL;DR: For a discussion of a case of international collective bargaining see David H. Blake, "Multinational Corporation, International Union, and Economic Implications of the 1967 UAW-Chrysler Agreement," in Transnational Industrial Relations, ed. by Hans Gunter (London: Macmillan, 1972). as discussed by the authors.
Abstract: Multinational corporations, by definition, have a multinational work force. However, the trade union institutions which represent the employees of the various subsidiaries have been organized historically on a country basis with little international interaction on industrial relations matters with a specific international employer.11It must be mentioned here that many United States unions are established on a bi-national basis in that they include a sizable Canadian membership. However, elsewhere the principle of organization is the particular nation-state. Union organization and representation activities have remained largely on the polycentric level even where their corporate adversaries operate in an ethnocentric or geocentric fashion. Recently though, international, regional, and national trade union organizations, particularly in the United States and Europe, have become concerned about the problems created by the multinational corporations because of their international nature. To confront these difficulties and to counteract the perceived advantages enjoyed by international firms, the trade union movement is developing a number of different strategies some of which may lead to the internationalization of industrial relations.22For a discussion of a case of international collective bargaining see David H. Blake, "Multinational Corporation, International Union, and Economic Implications of the 1967 UAW—Chrysler Agreement," in Transnational Industrial Relations, ed. by Hans Gunter (London: Macmillan, 1972). To phrase it in another way, in response to the challenge of the multinational corporation in union-management relations, unions are attempting to internationalize their activities and strength.© 1972 JIBS. Journal of International Business Studies (1972) 3, 17–32



Journal ArticleDOI
TL;DR: In this article, the authors used a computer model of a simple multinational enterprise system to investigate the financial practices used by real firms and used extensive interviews with financial executives in the home office, regional offices, and foreign subsidiaries of 39 multinational enterprises and with governmental, banking, accounting, and legal experts here and abroad.
Abstract: In addition, we use a computer model of a simple multinational enterprise system to investigate the financial practices used by real firms. Our research was based on extensive interviews, each lasting from one day to several weeks, with financial executives in the home office, regional offices, and foreign subsidiaries of 39 multinational enterprises and with governmental, banking, accounting, and legal experts here and abroad. In addition, the unpublished records of scores of firms and the published records of almost 200 firms were studied. In the Multinational Enterprise Study of the Harvard Business School, 187 U.S. firms meet our definition of "multinational enterprise." These are firms that appeared on the Fortune 500 list of the largest U.S. firms in 1964 or 1965 and had manufacturing facilities in six or more foreign countries by 1965. We class 90 of these as "small" (having foreign operations with annual sales of less than $100 million in 1969); 75 of them as "medium" ($100 million to $500 million); and 22 of them as "large" (over $500 million).

Journal ArticleDOI
TL;DR: For the next two decades we see multinational corporate activity as a leading system in what we call the "global industrial system." But a transformation process of the multinational corporate phenomenon is underway and should accelerate in the 1990s as discussed by the authors.
Abstract: For the next two decades we see multinational corporate activity as a leading system in what we call the "global industrial system." But a transformation process of the multinational corporate phenomenon is underway and should accelerate in the 1990s. Causes for this transformation include: (1) the appearance of coalitions between firms in rich, poor, and ideologically different countries in global industrial system constellations (GISCs); (2) the induction of geocentrization processes in nations and unions which will react on the multinational corporation's desire for viability and legitimacy; (3) impacts on neighboring institutions such as global cities and the global educational system. An ideology to legitimize certain kinds of multinational corporate activity should evolve during this transformation process. Harder to estimate are the structural consequences of social turbulence and anti-industrial counterforces to multinational corporate activity emerging today. Antimaterialism, affluence and aliena...

Journal ArticleDOI
TL;DR: A strong body of thought exists that denies such claims and asserts opposite views as mentioned in this paper, using arguments first elaborated by J. A. Hobson, an English pacifist writing at the turn of the century, such critics were early to recognize the global operating capacity of the corporate form of organization while rejecting the notion that it had positive effects either for social justice or for world order.
Abstract: A source of hope for some and of apprehension for others, multinational business is now recognized as a potentially powerful force for giving shape to world society. The advocates, or even the philosophers, of the multinational corporation have not been wanting in eloquence. They have especially claimed for this new instrumentality-beyond efficiency and productivity-high social merit in the global context (Ball, 1967: 80; Fortune, 1969; Peccei, 1971: 9; Brown, 1970: 7-8). In their enthusiasm and exuberance, they recall nineteenth-century optimism about the simple virtues of international trade as the universal force for peace. But a strong body of thought exists that denies such claims and asserts opposite views. Using arguments first elaborated by J. A. Hobson, an English pacifist writing at the turn of the century, such critics were early to recognize the global operating capacity of the corporate form of organization while rejecting the notion that it had positive effects either for social justice or for world order. Against the background of hostility to 'capitalism,' they invested business enterprises which were operating beyond the frontiers of the




Journal ArticleDOI
TL;DR: In this article, the authors argue that business corporations need to engage in external relations (ER) because society must be continuously convinced to give and maintain its support of this man-made and socially tolerated instrument for organizing economic activity and to stop short of unduly restraining it.
Abstract: Business corporations need to engage in external relations (ER) because society must be continuously convinced to give and maintain its support of this man-made and socially tolerated instrument for organizing economic activity and to stop short of unduly restraining it. Society here refers to the more or less organized and powerful institutions and interest groups that can assist or hamper business in its economic role. Government is usually the most relevant "external" institution but it is more or less influenced by interest groups and by the more amorphous general public. These various collectivities constitute the "nonmarket" and "macro-managerial" environments of business, which are distinct from the relatively free "markets" for the firm's inputs and outputs, and from its internal "micromanagement." Hence, external relations (ER) is that function


Journal ArticleDOI
TL;DR: This paper conducted surveys in Britain and France in late 1970 and Canada in late 1971 to identify the views of the significant elite groups on multinational firms, and the results are summarized in this article.
Abstract: The future evolution of multinational firms will depend to a large degree on the policy decisions of host nations, made essentially by leadership groups. Thus, knowledge of how elites feel about foreign business firms is a key element in analysis of the outlook for international business. There have been assorted expressions of elite attitudes on multinational firms including official national policies, speeches, and popular writing. But there have been no studies to identify systematically the views of the significant elite groups. To fill this gap, I undertook surveys in Britain and France in late 1970 and Canada in late 1971, results of which are summarized in this article.

Journal ArticleDOI
TL;DR: The authors in this paper reviewed the multinational marketing control practices of large U.S. multinational companies, compared these practices with domestic marketing control, and identified the major factors which influence the design of a multinational control system.
Abstract: The multinational enterprise with its operating subsidiaries spread over the globe presents formidable problems to managers responsible for marketing control. Each national market is different from every other market. Distance and differences in language, custom, and practices create communications problems. The size of operations and number of country subsidiaries often results in the creation of an intermediate headquarters, the so-called regional or area headquarters, which adds an organizational level to the control system. This article reviews the multinational marketing control practices of large U.S. multinational companies, compares these practices with domestic marketing control, and identifies the major factors which influence the design of a multinational control system.© 1972 JIBS. Journal of International Business Studies (1972) 3, 33–47


Journal ArticleDOI
TL;DR: In this article, the authors examined the implications of the international corporationunion interface for individual countries and suggested that the impact of this interface will depend on the production strategy of international corporation, the solidarity of the coalition of the unions in different countries, and the economic and political conditions prevailing in the individual countries.
Abstract: Summary The purpose of this paper has been to examine, on a pre-liminary basis, some of the implications of the international corporationunion interface for individual countries. It has been suggested that the impact of this interface will depend on the production strategy of the international corporation, the solidarity of the coalition of the unions in different countries, and the economic and political conditions prevailing in the individual countries. In order to gain a deeper understanding of the bargaining relationship between unions and international corporations, it is suggested that research will have to be conducted on the following topics: the industrial relations decision-making process of international firms, in particular the ways in which these firms react to international collective bargaining; the alternative strategies open to unions in international collective bargaining; the impact of international unionism and international firms on the industrial relations system of individual countries; the problems associated with international collective bargaining involving unions with different political ideologies; and the impact of international unionism on economic and political integration and the perception of national governments.




Journal ArticleDOI
TL;DR: In this paper, the authors examine the concerns of host country and parent country union leaders with respect to multinational enterprises and discuss the advantages accruing to the firms as a result of their multinational nature.
Abstract: Of crucial importance to any corporation is the relationship between management and its employees and their trade union representatives, and thus it is not surprising that the internationalization of management through the multinational corporation has had important consequences for industrial relations in general and trade union strategies in particular. This article identifies several dimensions of the internationalization of employment and then examines the concerns of host country and parent country union leaders with respect to multinational enterprises. A number of advantages accruing to the firms as a result of their multinational nature are discussed in the light of the single-state orientation of national unions. To counteract the strength of these enterprises, national, regional, and international union organizations have developed a number of new institutional structures and strategic thrusts. Union strengthening, legal regulation, and cross-national cooperative activities are explored as they ...

Book ChapterDOI
01 Jan 1972
TL;DR: The multinational corporation (MNC) has been acclaimed as an agent of development and has been condemned as a weapon of exploitation as discussed by the authors, and some advocate expropriation, while others have argued that what they believe to be the likely future decline of official aid makes it even more advisable than before to switch attention to direct private foreign investment as an external source of development finance.
Abstract: The multinational corporation (MNC)1 has been acclaimed as an agent of development and has been condemned as a weapon of exploitation. Those who have acclaimed it have argued that what they believe to be the likely future decline of official aid makes it even more advisable than before to switch attention to direct private foreign investment as an external source of development finance. Those who have condemned it point to the small or negative resource transfer, and some advocate expropriation.