In this perspective paper we argue that outward foreign direct investment (OFDI) undertaken as escape response to perceived misalignment between firm needs and home country institutional conditions represents an important but under-explored phenomenon in the international business (IB) literature. We propose that, in advanced industrialized nations, the extent of OFDI as escape is likely to rise with the extent of societal coordination in the political economy. Societal coordination is associated with relatively slower rates of institutional adjustment and thus with relatively greater prevalence of misalignments that may drive OFDI. We illustrate the face validity of our argument and lay out the implications for future research in IB. Journal of International Business Studies (2007) 38, 579–594. doi:10.1057/palgrave.jibs.8400285
De-globalization, now a distinct possibility, would induce a significant qualitative shift in strategies, structures, and behaviors observable in international business (IB). Coming to terms with this qualitative shift would require IB research to develop a much deeper integration of politics, the key driver of de-globalization. To support such integration, this paper introduces two relevant theories of (de-)globalization from political science, liberalism and realism. Both predict de-globalization under current conditions but lead to different expectations about the future world economy: liberalism suggests a patchwork of economic linkages, while realism predicts the emergence of economic blocs around major countries. This paper discusses the resulting opportunities in three areas of IB research: political strategies and roles of multinational enterprises (MNEs), global value chains, and the role of the national context. For political strategies and roles, there is a need to explore how regular business activities and deliberate political agency of MNEs affect the political sustainability of globalization. For value chains, questions include their future reach and specialization, changes in organizational forms, and the impact of political considerations on location decisions. Research opportunities on national contexts relate to their ability to sustain globalization and their connection with economic and military power.
International business (IB) researchers have been slow to embrace a configurational approach in hypothesis formulation and empirical analysis. Yet, much of what IB scholars study is inherently configurational: various explanatory factors and their interplay simultaneously determine the outcome(s) studied, such as governance choice or firm-level performance. The mismatch between the nature of the empirical phenomena studied on the one hand, and hypothesis formulation and empirical methods deployed on the other, explains why many quantitative empirical studies in IB are overly reductionist, relying on hypotheses that assume linear (or simple, curvilinear), unifinal, and symmetrical effects. In this Editorial, we introduce IB scholars to contemporary configurational thinking and its analytical tool, fuzzy-set qualitative comparative analysis (fsQCA). We discuss this tool's main tenets, advantages, and disadvantages. We review the limited prior IB research using this approach and present a wide range of IB phenomena where it could be usefully applied. We propose that contemporary configurational thinking and fsQCA can help scholars produce insights more closely aligned with the complex realities of international business than conventional research approaches. Journal of International Business Studies (2020) 51, 455-466.
De-globalization, now a distinct possibility, would induce a significant qualitative shift in strategies, structures, and behaviors observable in international business (IB). Coming to terms with this qualitative shift would require IB research to develop a much deeper integration of politics, the key driver of de-globalization. To support such integration, this paper introduces two relevant theories of (de-)globalization from political science, liberalism and realism. Both predict de-globalization under current conditions but lead to different expectations about the future world economy: liberalism suggests a patchwork of economic linkages, while realism predicts the emergence of economic blocs around major countries. This paper discusses the resulting opportunities in three areas of IB research: political strategies and roles of multinational enterprises (MNEs), global value chains, and the role of the national context. For political strategies and roles, there is a need to explore how regular business activities and deliberate political agency of MNEs affect the political sustainability of globalization. For value chains, questions include their future reach and specialization, changes in organizational forms, and the impact of political considerations on location decisions. Research opportunities on national contexts relate to their ability to sustain globalization and their connection with economic and military power.
Efforts to build a universal theory of the world's business systems require empirical grounding in an understanding of the variety that need explaining. To support such theorizing, we analyzed the institutional structures of 61 major economies, accounting for 93.5% of 2013 world GDP at purchasing power parity. We found nine main types of business systems: Highly Coordinated, Coordinated Market, Liberal Market, European Peripheral, Advanced Emerging, Advanced City, Arab Oil-Based, Emerging, and Socialist Economies. Our findings illustrate the need to go beyond the Varieties of Capitalism and Business Systems frameworks; provide empirical support for the CME versus LME dichotomy for part of the OECD; identify some of the business systems proposed recently as sub-types of larger clusters; indicate that institutional diversity may increase with development level; and cast doubt on the notions of state-led and family-led capitalism as types of business systems. Our discussion further suggests numerous avenues for theory development and empirical research.
How do national-level institutions relate to national comparative advantages? We seek to shed light on this question by exploring two different sets of hypotheses based on the Varieties of Capitalism and other branches of comparative capitalisms literature. Applying fuzzy-set qualitative comparative analysis to data from 14 industries in 22 countries across 9 years, we find that comparative advantages in industries with radical innovation emerge in specific configurations mixing coordinated and liberal institutional features. Institutional comparative advantage in industries with radical innovation may thus be based on the ''beneficial constraints'' of opposing institutional logics rather than on the self-reinforcing institutional coherence envisioned in much of the Varieties of Capitalism literature. By contrast, we find that coordinated market economies may have comparative advantages in industries with incremental innovation, as envisioned in the Varieties of Capitalism literature. Our article contributes to our understanding of the ''so what?'' related to capitalist diversity and its implications for location decisions of multinational enterprises. We further present a coordination index going beyond Hall and Gingerich (Br J Polit Sci 39:449-482, 2009) with annual values for 22 OECD
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