Market Globalization by Firms from Emerging Markets and Small Countries: an Application of the Neoclassical Trade Model

The changes in globalization and in the world of international business make it necessary to rethink the basic model of the economics of international business. For most of the 2nd half of the 20th centuryinternational business was about how large companies in the developed countries increase their valuevia international business activities. Not surprisingly the research in the economics of international business from Caves, Kindleberger, and Hymer to Buckley and Casson, Dunning, and many others was based on models of industrial organization. The world has changed and international business has become a two-way street where firms and governments from emerging markets and small countries are as active as the developed countries MNEs and their governments. In this paper the basic international trade model is used to gain insights of the new world of international business. In particular, a dynamic model of changing factor intensity and of creating local specific competitive and comparative advantages for firms and governments from emerging markets is presented and discussed.Economics of international business, international trade models, emerging markets

Technology Acquisition among Asian Firms and Technology Clusters in the United States

This paper examines the nature of reverse technology transfer between Asian firms and their subsidiaries in the United States (US). Traditional models of technology transfer suggest that industrializing Asian firms access international technology and knowledge through local spillovers from the activities of foreign firms located in Asia. In this research, we propose a new model of technology development where Asian subsidiaries locate in targeted geographical areas in the US with the objective of acquiring both tacit and codifiable knowledge. Acquisition patterns involve a combination of interactions between suppliers and customers, and, human resource dynamics in the US. Industrial prototypes and knowledge are then transferred back to parent firms in Asia. This pattern of technology development among industrializing Asian firms suggests that a category of subsidiaries is emerging that plays a far more developmental role than the literature currently acknowledges. It also points to shifts in firm strategy in terms of international patterns of technology transfer from learning-by-doing to learning-by-interacting.

Understanding the role of attitude components in co-branding: an application to high-tech, luxury co-branded products

This study addresses co-branding between firms belonging to unrelated value chains –high-tech products and luxury brands (HLCPs) – to explore how consumers? attitude drive the success of HLCPs. The study applies the tri-component attitude model (as opposed to attitude as a whole) that uses affect and cognition to predict purchase intention of co-branded products. Cultural differences (Spanish and Taiwanese) in consumers? behavior are also assessed. Data collected in a survey show that Spanish and Taiwanese consumers adopt different purchasing processes: while Spanish consumers place more importance on product-related thoughts and follow a Feel-Learn-Do sequence in purchasing HLCPs, Taiwanese consumers follow a Learn-Feel-Do purchasing process.Co-branding, Attitude, Affect/cognition, High-tech, Luxury, Cross-cultural

Technological learning in six firms in Southern China: success and limits of an industrialisation model

This article examines the creation of industrial enterprises and the basic models of firm-level technological learning behaviour of the last 20 years in China. Six case studies of technological learning and links to external sources of know-how from the South of China in the Pearl River Delta are examined. It is shown that the learning process that has been experienced in these enterprises is similar to that of other fast growing East Asian economies. Until now enterprises have been acquiring technology through external linkages with foreign clients that become their main providers of technology. A detailed account of the enterprises allows a typology of the external technological learning. It is claimed that the growth of the South China lies in this ‘external’ interactive technological learning, as in other East Asian economies.Asia; China; industrial development; technological learning; private enterprises; interactive learning; economic reform

Resolving post-formation challenges in shared IJVs: The impact of shared IJV structure on inter-partner relationships

The “50/50”, or the shared management international joint venture (shared IJV) remains a popular and yet challenging control structure to govern IJVs. The purpose of this study is to understand the post-formation management of shared IJVs, specifically the relationship between shared structure, relational conditions and management of post-formation challenges. Our evidence is based on 26 in-depth interviews across four cases of shared IJVs between British multinationals and Asian companies. Our findings indicate that the highly integrative nature of shared IJVs, including high operational interdependence and shared decision-making, encourages partners to work closely together, communicate frequently and intensely and exchange personnel. Although share management can lead to inter-partner conflicts, the equal investment and mutual responsibility partly provides partners with motivation and opportunities to learn about each other, to better implement the control structure, to build trust, and to commit to the venture and partner. These relational conditions facilitated the successful management of post-formation challenges such as diversity related conflicts and macro volatility

The Characteristics of Sino-Taiwanese Joint Ventures in the People's Republic of China

The main objective of this thesis is to shed light on the characteristics and performance of Sino-Taiwanese joint ventures (JVs) in the People's Republic of China and in particular to investigate the role played by guanxi (interpersonal relationships) in their formation and in the way they function. The research shows that guanxi enhances the effectiveness of Taiwanese joint venture partners by overcoming unanticipated external environmental factors and enabling them to deal with the complex internal managerial issues associated with the Chinese market. The different political and economic relations between Taiwan and China make the joint venture entry strategy attractive to Taiwanese investors. Taiwanese investors share similar cultural identity and speak the same dialect as much of Mainland China. The literature on international joint venture formation is reviewed and compared business made between western style networking and guanxi relationships in Chinese business communities. The impact of cultural similarity on partner selection has been added in this study of Sino-Taiwanese Ns, which therefore provides a new strategic perspective. A triangulation research method is employed to provide a systematic analysis. In particular, a first set of interviews identified the possible variables in JV development and established important contacts in China, to assist in carrying out a second questionnaire survey. A further round of interviews confirmed the validity of the findings. A strong positive correlation was found between firms' cooperative strategies and the uncertainties of the Chinese business environment. This has demonstrably influenced Taiwanese investors' decision to collaborate with Chinese firms in joint ventures. The interview evidence clearly shows the importance of guanxi at different stages of JV formation and development. The thesis concludes that the effective use of guanxi has enhanced Taiwanese investors' effectiveness within the highly uncertain business environment of China

Intra-firm Technology Transfer and R&D in Foreign Affiliates: Substitutes or Complements? Evidence from Japanese Multinational Firms

R&D in foreign affiliates and technology transferred from their parent firms are important potential drivers of productivity in host countries. In this paper we examine the simultaneous impact of local R&D and intra-firm international technology transfer on productivity growth in foreign affiliates. We estimate a dynamic productivity model on a large sample of Japanese manufacturing affiliates worldwide in 1996-1997 and 1999-2000. We find that both affiliate R&D and intra-firm technology transfer contribute to productivity growth, while technology transfer exhibits decreasing marginal returns. The two sources of technology are complements: use of one source of technology increases the marginal impact of the other.R&D, technology transfer, multinational firms

Taiwan and China

China's relation to Taiwan has been in constant contention since the founding of the People's Republic of China in October 1949 and the creation of the defeated Kuomintang (KMT) exile regime on the island two months later. The islands autonomous sovereignty has continually been challenged, initially because of the KMT's insistence that it continue to represent not just Taiwan but all of China and later because Taiwan refused to cede sovereignty to the then-dominant power that had arisen on the other side of the Taiwan Strait. One thing that makes Taiwan so politically difficult and yet so intellectually fascinating is that it is not merely a security problem, but a ganglion of interrelated puzzles. The optimistic hope of the Ma Ying-jeou administration for a new era of peace and cooperation foundered on a landslide victory by the Democratic Progressive Party, which has made clear its intent to distance Taiwan from China's political embrace. The Taiwanese are now waiting with bated breath as the relationship tautens. Why did detente fail, and what chance does Taiwan have without it? Contributors to this volume focus on three aspects of the evolving quandary: nationalistic identity, social economy, and political strategy

An evolutionary stage model of outsourcing and competence destruction : a Triad comparison of the consumer electronics industry

Outsourcing has gained much prominence in managerial practice and academic discussions in the last two decades or so. Yet, we still do not understand the full implications of outsourcing strategy for corporate performance. Traditionally outsourcing across borders is explained as a cost-cutting exercise, but more recently the core competency argument states that outsourcing also leads to an increased focus, thereby improving effectiveness. However, no general explanation has so far been provided for how outsourcing could lead to deterioration in a firm‟s competence base. We longitudinally analyze three cases of major consumer electronics manufacturers, Emerson Radio from the U.S., Japan‟s Sony and Philips from the Netherlands to understand the dynamic process related to their sourcing strategies. We develop an evolutionary stage model that relates outsourcing to competence development inside the firm and shows that a vicious cycle may emerge. Thus it is appropriate to look not only at how outsourcing is influenced by an organization‟s current set of competences, but also how it alters that set over time. The four stages of the model are offshore sourcing, phasing out, increasing dependence on foreign suppliers, and finally industry exit or outsourcing reduction. The evolutionary stage model helps managers understand for which activities and under which conditions outsourcing across borders is not a viable option. Results suggest that each of these firms had faced a loss of manufacturing competitiveness in its home country, to which it responded by offshoring and then outsourcing production. When a loss of competences occurred, some outsourcing decisions were reversed