Full papers
Full Papers
Inflow FDI Agglomeration, Congestion Effect and Firms Productivity in China A Spatial Econometric Analysis (140)
Author/s: Xiao Long Chen
Track: International Business and International Management
Paper Type: Full Papers
Keywords: FDI agglomeration, productivity, spatial econometrics, geography, China
Abstract: This paper expands the literature on industry agglomeration to explore the non linear and spatial effects of horizontal, backward and forward foreign direct investment agglomerations on domestic firms productivity by employing a spatial econometric model with random effects based on the data of 12240 firms covering the period 2010 2013 from Chinas Annual Industry Survey Database. In addition to the vital impact of firm characteristics e.g. firm size and capital intensity and geography characteristics e.g human capital and transport infrastructure, I also identify that the congestion inverted U shaped relationship dominates the effect of the three types of FDI agglomerations on local firms productivity, and a U shaped relationship dominates the effect of their spatial agglomerations on neighbouring firms productivity. I further capture that the interaction intensity of backward and forward FDI agglomerations with local and neighbouring firms are similar and much stronger than that of horizontal FDI agglomeration. The empirical findings provide some essential implications for region and industry policies.
Old Risks, New Prospects? An empirical evaluation into the risky business of foreign market re-entry (194)
Author/s: Irina Minodora Surdu Edith Ipsmiller
Track: International Business and International Management
Paper Type: Full Papers
Keywords: N/A
Abstract: Going back into previously exited markets represents a significant management risk. But, how are re entry risks managed By combining Millers risk management perspective with prospect theory, our study examines how the risks of re entry after initial entry and exit have been managed by 1020 re entrants. We move away from narrow risk management lenses according to which risks happen in isolation and examine how firms strategically manage re entry risk by exploiting the trade offs among external and internal sources of risk. For re entrants, market failure, followed by a total exit, may become the strategic reference point for evaluating future market prospects and hence is likely to determine a firms risk orientation and how strategic risk trade offs are made. This paper proposes that MNE re entrants will seek to manage the amount of re entry risk they are exposed to by choosing commitment modes that enable them to maintain strategic flexibility at re entry. Our results showed that international diversification is strongly correlated with re entering countries with higher levels of institutional and market risk, but taking longer to re enter and opting for lower commitment modes of re entry. We propose a novel approach to international strategic risk management which reveals some of the trade offs among various sources of risk and the tools employed to manage them.
Applying Spatial Durbin Panel Model on US Exports to Improve the Trade Deficit (268)
Author/s: Yi-cheng Liu Wen Yang
Track: International Business and International Management
Paper Type: Full Papers
Keywords: Spatial Durbin Panel Model, US exports, US trade deficit, Exports Determinants, Spatial Patterns
Abstract: This paper aims to explain the US exports behavior, and empirical results provide valuable insights for improving persistent US trade-deficit issues. The main US export destinations are West-European countries of the European Union and Japan. The determinants of the US exports were highly related to countries with outward-foreign-direct investment from the US corporations and were highly open for international trade. Also, these countries tended to have a higher GDP per capita and have regional-economic-integration agreements according to evidences of the Spatial Durbin Panel Model. We suggest that the US increases exports to different regions and hence, improve US trade deficits.
Inequality And The Internationalization Of State-Owned Multinationals (306)
Author/s: L Jeremy Clegg Hinrich Voss Janja Tardios
Track: International Business and International Management
Paper Type: Full Papers
Keywords: State-owned multinational corporations, Inequality, Neomercantilism, Foreign direct investment, Mergers &, acquisitions
Abstract: We theorize that home country social inequality, signifying an unequal distribution of property rights and thus, the exploitation and accumulation of wealth, determines the internationalization of state capitalism abroad via foreign direct investment. Using a global sample, we find that state owned enterprises from income unequal home countries are predisposed to corporate acquisitions abroad, more so than privately owned enterprises. Both effects are heightened when the host country is income unequal. Decomposition of the home country pattern by political regime suggests that, at high autocracy, privately owned enterprises acquisition behaviour reflects state agency, while under democracy state owned enterprises become independent of the state.
The Role of Munificence-Hostility on Decision-making Logic of Internationalising SMEs: A Comparative Study (330)
Author/s: Heba Younis Said Elbanna
Track: International Business and International Management
Paper Type: Full Papers
Keywords: N/A
Abstract: The study identifies and examines patterns in decision making logics in the context of SMEs internationalisation in munificent hostile business environments. The study adopts a process approach to case study research, by examining 169 internationalisation decision events in four SMEs in two emerging economies, Qatar and Egypt. The study establishes that decision makers employ hybrid decision making logics and shift from one dominant logic to another. The shifts are explained by identifying the role of munificence hostility in shaping SMEs resource positions. We move beyond the classical convention that effectuation is a proactive and emergent way of dealing with uncertain environments and advance a hybrid perspective of causal and effectual logics in SME internationalisation decision making. The study broadens current understandings on the drivers of effectuation and causation beyond the classical view which associates effectual decision making logic to uncertainty and prior entrepreneurial experiences and provides grounded propositions for further empirical testing.
The Generation Of Emotions Through Intercultural Interaction Within A Multinational Enterprise. (438)
Author/s: Qiu Wang Jeremy Clegg Hanna Gajewska-De Mattos Peter Buckley
Track: International Business and International Management
Paper Type: Full Papers
Keywords: Intercultural interaction, Emotion, Intra-MNE knowledge transfer, Qualitative research methods
Abstract: We explore how and why emotions generated within the international workplace diverge between individuals for reasons of national culture. We utilize knowledge transfer instrumentally as the context of cooperation within a Chinese multinational enterprise. Analyzing data from interviews with foreign subsidiary staff, and with Chinese headquarters staff to whom knowledge is transferred, we find that individuals appraise their potential to address intercultural difference interactively and recursively. Using this theoretical innovation that appraisal is bilateral, we propose that knowledge asymmetries trigger cultural predispositions towards distinct emotional experiences, thus creating asymmetric intercultural feedback, heightening felt tension, with cultural friction as a byproduct.
What Matters to Performance Fluctuation: The Roles of Global Diversification and Home-region Concentration (441)
Author/s: Shubin Wu Jane Lu
Track: International Business and International Management
Paper Type: Full Papers
Keywords: performance fluctuation, geographic diversity, home-region concentration, home-region homogeneity
Abstract: Risk reduction by geographic expansion has been proposed but not systematically examined in the traditional multinationality and performance literature or the recent regionalization and performance literature. Risk diversification should be one of main considerations in the debate of inter- and intra-regional diversification strategy for both academics and practitioners. Drawing on portfolio theory, we argue that geographic diversification helps to reduce idiosyncratic risk associated with a particular market and leads to lower performance fluctuation. This relationship is weakened by home-region concentration in general and by the homogeneity of macroeconomic conditions of the home region in particular. In a sample of 818 publicly-listed Japanese manufacturing firms and their overseas manufacturing affiliates from 1985 to 2006, we find support to our predictions.
Informal Institutions Matter: Strategies of Chinese Multinational Enterprises Operating in Australia (460)
Author/s: Mingqiong Mike Zhang Ying Candy Lu Cherrie Jiuhua Zhu
Track: International Business and International Management
Paper Type: Full Papers
Keywords: Australia, China, informal institution, longitudinal qualitative study, multinational enterprise
Abstract: Multinational enterprises (MNEs) need to understand and handle various formal and informal institutions in host countries so as to survive and succeed. How MNEs effectively respond to and strategically manage formal and informal institutional characteristics of host countries is an important question of the scholarly inquiry. However, the existing MNE literature has focused on formal institutions and national cultures, the interactions between informal institutions and MNEs have been comparatively ignored. This paper addresses this important but neglected topic based on an in-depth longitudinal qualitative study. It identifies some key informal institutions in Australia, examines how such institutional distinctiveness shapes the behaviour of Chinese MNEs and how they handle such informal institutional differences between China and Australia. Our findings demonstrate that informal institutions of a host country significantly shape the behavior and firm-level strategies of MNEs. The findings challenge some taken-for-granted assumptions regarding the relationship between formal and informal institutions.
Common In-group Identity and Cultural Intelligence as Key Factors of Multicultural Team Effectiveness (484)
Author/s: Mario Konishi Juan Shan Patricia Pullin Anna Lupina-Wegener
Track: International Business and International Management
Paper Type: Full Papers
Keywords: Multicultural teams, shared identity, cultural intelligence
Abstract: This research aims to investigate the relationship between shared identity, cultural intelligence, communication and team effectiveness in multicultural teams (MCTs). Our contribution is threefold. Firstly, we propose an integrative model encompassing key factors of team effectiveness in MCTs. Secondly, unlike previous research, we study cross-cultural interactions on the team rather than individual level. Thirdly, building on social identity and self-categorisation theories, we apply the construct of common in-group identity to MCTs, which remains an underexplored approach to date. We surveyed MCTs of students participating in international programs. Our findings show that common in-group identity is positively related with communication effectiveness and team effectiveness. Common in-group identity and communication effectiveness play a significant full chain mediating role in the relationship between cultural intelligence and MCTs effectiveness. From a managerial point of view, these results suggest the importance of training leaders to develop a team identity.
Returnee Over Time and FDI Knowledge Spillover: How Does FDI Affect Firm Productivity in Emerging Markets (561)
Author/s: Dongyang Zhang RUI GUO Lutao Ning
Track: International Business and International Management
Paper Type: Full Papers
Keywords: FDI, Returnee, Firm productivity, China
Abstract: This paper investigates the moderating effect of returnees time based features, which include entry speed and irregularity, in helping domestic firms absorbing Foreign Direct Investment knowledge spillovers. Using an unparalleled dataset containing comprehensive information about 14065 Chinese hightech firms located in Zhongguancun ZGC science park in Beijing during 2007 to 2013, we find that the positive relationship between FDI in the industry and the total factor productivity of domestic firms becomes stronger as the returnee entry speed increases while weaker as the returnee entry irregularity increases. Our research highlights that the timebased features of returnee should be carefully considered for domestic firms as special channels to absorb foreign knowledge and they may contribute to the inconclusiveness of FDI spillover effects. Therefore, the findings have important implications for policymakers and practitioners.
Hello, World A Sentiment Analysis of the Trailing Spouses Online Blogs (598)
Author/s: Alexei Koveshnikov Heidi Wechtler Juho Lindman
Track: International Business and International Management
Paper Type: Full Papers
Keywords: trailing spouses, time, emotions, adjustment, sentiment analysis, blogs
Abstract: In this study, we contribute to the literature on adjustment of trailing spouses to new cultural environments by using an innovative research design where we employ sentiment analysis to examine trailing spouses blog entries over time as our source of data. Based on our analysis of blogs maintained by 12 trailing spouses relocated from Western countries to China, we identify four distinct trajectories of emotions, interpreted as a proxy for psychological adjustment, during the expatriation process. We also illustrate the contingency of the adjustment on the spouses individual and contextual factors and discuss differences and similarities between the four configurations of adjustment. We propose four profiles of trailing spouses, the observers, the optimists, the carers, and the mourners.
What Determines Emotional Intelligence and Cultural Intelligence Among Managers in cross border business Organisations? The Effects of Organisational Culture and Role Stressors (736)
Author/s: Amadeus Kubicek Ramudu Bhanugopan
Track: International Business and International Management
Paper Type: Full Papers
Keywords: Cultural Intelligence, Emotional Intelligence, Organisational Culture
Abstract: During the last decade, researchers attention to the defining role of organisational culture has consistently been refined in the context of different cultural settings. Similarly, the effects of role conflict, ambiguity, and overload in cross cultural settings has also advanced, drawing inference to values and belief systems. The literature on the relationship between emotional intelligence and cultural intelligence shows that little is known about the mediating roles of organisational culture and cross cultural role conflict, ambiguity, and overload. With a sample of 299 respondents across Australia, United Kingdom, United States of America, and Singapore, we found that organisational culture partially mediates the relationship between emotional intelligence and cultural intelligence, and that only role ambiguity fully mediates that relationship. Furthermore, the results revealed emotional intelligence to have a positive relationship with cultural intelligence, organisational culture, and cross cultural role conflict, ambiguity, and overload. The results highlighted the degree of influence of organisational culture and role conflict, ambiguity, and overload between emotional intelligence and cultural intelligence in a cross cultural context.
How International Telecommunication Firms Respond to Regulatory Institutions to Obtain Legitimacy in Emerging Market Economies (792)
Author/s: Ugbede Umoru
Track: International Business and International Management
Paper Type: Full Papers
Keywords: institution, legitimacy, internationalisation, telecommunication, Nigeria
Abstract: This paper contributes to the existing literature on the regulatory environment in host countries. It argues that post entry expansion stage of firms internationalisation process requires more attention, given the uncertain regulatory environment in which international firms, in particular, international telecommunication firms face within the emerging market. The paper used the institutional theory as an underpinning theoretical lens to explain how emerging market firms respond to the institutional demands at their post entry in an African market, with a particular focus on Nigeria. Through a case study approach, the findings from interviews with senior level managers in two emerging market telecommunication firms operating in Nigeria show that firms respond to the institutional demands strategically at their post entry stage through unique ways, including informal engagement within the institutional environment to gain legitimacy. This process of engagement has not been thoroughly investigated by past literature.
Globalization And National Cultural Values: Are Indian Youngsters Really More Global Than Indian? (833)
Author/s: Santana Pathak
Track: International Business and International Management
Paper Type: Full Papers
Keywords: National Cultural Values, Globalization, Generation Y, Empirical Study
Abstract: The paper studies the possible shift in Indias National Cultural Values at the individual level following globalization through an empirical design on 719 generation Y2K respondents. The sample respondents were brought up post 1991s economic liberalization and a small sample of integrators were added. The background to the study was formulated from Ingleharts 2001 theory that exposure to a globalized, more prosperous world can change the value system of the next generation of a particular country. The variables measuring cultural consciousness as identified by the indexes of Hofstede was measured at the individual level on each respondent by administering the Yoo, Donthu and Lenartowicz 2011 Cultural Values Scale CVSCALE. The result of the study shows that Indian generation Y2K shows different orientation than the traditional or conservatives in terms of masculinity and power distance dimension. The dimension of uncertainty avoidance also shows shift. The results have tremendous scope to extend understanding of Indian national cultural context for multinationals and policy making.
Internationalization Barriers of Thai Online Fashion SMEs Through Social Media (943)
Author/s: Jinmin Wang Tanawat Turmratanasuwan
Track: International Business and International Management
Paper Type: Full Papers
Keywords: SMEs, Thailand, social media, internationalization barriers
Abstract: This paper examines the major internationalisation barriers of 252 online fashion SMEs in Thailand through social media channels with survey data collected in 2018. The empirical results indicate that most of the Thai online fashion SMEs face more internal barriers than external barriers. The marketing based and firm specific factors are considered as the major barriers to the internationalisation, including high international transportation, insurance and operation costs, lack of experience in selling abroad, and not being known in foreign markets. The firm size, number of Instagram followers, number of employees, and net income can also influence the online fashion SMEs internationalisation decisions significantly. The age and gender of these online fashion SMEs have not significant impact on their internationalisation decisions.
Collectivistic Orientation, Decision-making Process, and Local Linkages in International Entry: A Study of Chinese SMEs (1102)
Author/s: Junzhe Ji
Track: International Business and International Management
Paper Type: Full Papers
Keywords: Collectivistic orientation, Local linkages, Procedural rationality, Problem-solving dissension.
Abstract: External networks constitute a critical aspect in SME (small and medium-sized enterprise) internationalisation, which nevertheless has seldom been explored from the perspective of international decision-making. To respond to this research insufficiency, this study firstly sets and investigates a baseline association between collectivistic orientation of decision-makers and the employment of local linkages for the international entries of SMEs. The relationship is further assessed by incorporating two critical decision-making process (DMP) dimensions in terms of procedural rationality and problem-solving dissension as its boundary conditions. An analysis of 208 internationalised Chinese privately-owned SMEs suggests that collectivistic orientation is positively related to the employment of local linages; and, procedural rationality and problem-solving dissension moderate the association according to our expected hypotheses.
Developing IJVs Absorptive Capacity for Promoting Low Carbon Technology Transfer The Role of Intermediaries and External Channels (1118)
Author/s: Linlan Huang Huan Zou
Track: International Business and International Management
Paper Type: Full Papers
Keywords: technology transfer, international joint ventures, intermediaries, innovation, low carbon technology.
Abstract: One of the perquisites of a successful technology transfer is that the firm should have sufficient absorptive capacity. Such capacity is not a take-for-granted product but go through a sophisticated development process. While most studies highlight the absorptive capacity and network in the process, the role of intermediaries is often underlined. In this study, we adopt the process-perspective on examine how international joint ventures conduct external knowledge search via intermediaries in the absorptive capacity development process in IJVs technology transfer. Based on three in-depth qualitative cases in low carbon industry, this study unfolds that successful innovators should not be isolated from intermediaries in the recent model of the innovation system. Instead, they interact with a variety of intermediaries at different stages of technology/knowledge transfer to secure the best-available resources and knowledge supporting absorptive capacity-building and innovation, which finally becomes a part of their market competitiveness.
Exploring the Willingness of Monocultural and Bicultural Individuals to Undertake International Assignments (1156)
Author/s: Michael Isichei
Track: International Business and International Management
Paper Type: Full Papers
Keywords: Global Mobility, International Assignments, Expatriation, Biculturalism, Bicultural Identity Integration
Abstract: This study explores the effect of cultural identification on global mobility. Specifically, it examines the impact of self identification as monocultural or bicultural on a persons willingness to undertake an international assignment. It also considers how, the degree of integration between the cultural identities of bicultural individuals, known as bicultural identity integration, influences this. The study of bicultural individuals continues to move beyond its origins in the psychology literature as business and management scholars increasingly recognize the significance of bicultural experiences and skills within organisations. Culturally diverse individuals, such as biculturals, who are poised between two cultures, multiple languages, and several cultural traditions, are increasingly seen to represent a significant source of value for multinational organisations. Given the consistent increase in the need for globally mobile employees, this study considers the suitability of bicultural individuals for international work. The study analyzes the impact of cultural identification on the willingness of third level students to undertake an international assignment in the future. Data for the study came from 285 third level students, across eighteen third level institutions in the Republic of Ireland. The results indicate that bicultural individuals are more willing to work internationally than monocultural individuals. Furthermore, the results reveal that bicultural individuals exhibit higher levels of cultural intelligence, and cultural intelligence mediates the relationship between cultural identification and willingness to undertake an international assignment. This study provides empirical evidence that culturally diverse individuals, such as biculturals, are a distinctive source of talent for global mobility.