Handbook Institutional Approaches to International Business

321 Pages·2012·43.605 MB·English

by  Geoffrey Wood Mehmet Demirbag

Handbook of Institutional Approaches
t0 International Business
‘The latestgeneration ofresearch in cornparative institutional Handbook oi
analysis ofbusiness is impressively captured in this voiurne; readers
find depth in theory deveiopment, breadth in application to practise-
institutional Approaches
andpolicy, and insight on the big research issues ahead. Both
generalist and specialist readers vvili find much ofvalue here.’
— Bruce Evan Kaufman, Georgia State University, Ugo,
to internationai Business
This inspiring Handbook brings together alternative perspectives
from a range of disciplines to shed light on the nature of institutions
and their relationship to firm-level practices and outcomes across a
Edited by Geoffrey Wood - Mehmet Demirbag
vvide range of national settings.
Expertly vvritten by leading scholars from a range of different starting
points, this compendium presents a synthesis of recent vvork S[BSliOGi1IiBIElHS.I9H1HUI01
relating to institutionally-informed accounts from transitional and
Be/1p(qaeoLn..uiow,q|/;ae0y|q/au\9
emerging markets, as vvell as from mature economies. lt specifically
focuses on the linkage betvveen institutions and vvhat goes on inside
firms, and the relationship betvveen setting, strategic choice and
systemic outcomes.
The Handbook is explicitly multi-disciplinary, encompassing
perspectives from a range of the functional areas of management
studies. lt vvill prove invaluable for postgraduate students and
s[gsautoppenoomxsduld>v100qpusH
faculty in international business, and the vvider research community
in the areas of international business, corporate governance,
socio—economics, and comparative HRM.
Geoffrey Wood and Mehmet Demirbag are are both Professors in
the School of Management at the University of Sheffield, UK.
‘-
HANDBOOK OF INSTITUTIONAL
APPROACHES TO INTERNATIONAL
BUSINESS
‘ll
Handbook of Institutional
Approaches to International
Business
Editedby
Geoffrey Wood and Mehmet Demirbag
Salton!ofMcmugemem, Unti'r:rsi't_v o/'Slre[fieM, UK
Edward Elgar
Chcltcnham. UK * Northampton, MA, USA
I
Contents
-
ii‘ GeoffreyWood and Mchmct Demirbag2tll2
All rights reserved. Nopart olitliis publication miiybe reproduced.stored‘ LI-M {J£_mm,”n”m__\_
viii
inii retrieval system ortransmitted in any formorbyanymeans,electronic, , . :_, I _
iiiv
mechanical orphotocopying, recording, orotherwisewithout the prior mi’“"-'l“'¢*'"'-'1'"Ill’ Gfiidyi'31’ ll ‘Pitt’""tlMi’""9-' DWI"5'-“'8
permission ofthepublisher.
PART I INSTITUTIONS AND COMPARATIVE
Publirlisd by BUSINESS STUDIES: THE STATEor-"THE
[Edward Elgar Publishing Limited ART
The Lypiatts
I5 Lansdoivn Road
Cheltcnham l Institutions andcomparative businessstudies: supranational
GlosGLSUZJA and national regulation 3
UK Ger.fli'c_t* Worirltint]rl/Ieliiiiei Deiiiii'lirig
2 International business, multinationalsand national business
ELIWtlI'tI ElgarPublishing. Inc.
systems I8
William Pratt House
9 DeweyCourt Glenn Morgan
Northampton 3 Financing lirms in dilierent countries 4]
MassachusettsillU60 Frriiil-.'l'i'n AHeii
USA
4 Anglo-Saxon capitalism in crisis‘? Models ofliberal capitalism
and the preconditions for financial stability 65
Sire KoiizeliiiriiiiiriiirlMore Ft!l’tI'.l"gIi't.’-DtIl'iL’.I'
5 Framing human resource management: the importanceof
national institutional environments to what management
Acatalogue record l'orthisbook
does (and should do) 115
isavailable from the British Library
Johii Giirfriifl
6 Constitutivecontexts?the myth ofeommon cultural values I42
LibraryofCongressControl Number: Zlll[9415-’-lti Bieiiiiciii MIJSIi'eene_v
7 The role oiinstitutions and multinational enterprises in
economicdeveIopment I73
Ben L. Ktvfiu. Jock .-I. ClriiiipitandNolan T. Git/jiiey
8 The International LabourOrganization 204
Ni'gi:lHriirrii'riirindSteve I-IiigIit*.i'
I 9 Categoriesoidistaneeand international business 219
MIX
Flag:fl'flI'l'l- Afirrirri Ciiei'ivi-Cri:iirruuiirlMeliiiiei Eivleiii Geiic
rupem 0mums!
FSC'C0185?-'5 I0 Beyond the ‘rules oithegame? three institutional
approachesand how they matter for international
ISBNW8 I 849801'685(cased) business 2315
Ju.i'_iici'J. Hoiliriand Torlien Perfer.i'eii
Typeset byScrvis Filmsctting Ltd,Stockport, Clieshirc
Printed and bound by MPG BooksGroup. UK
‘I
vi Iiniiitiiiioinrfrni;ii'ririi*/itrsto i'niei*iirn‘iriiin/lnon'iie.i'.r C'onren!.i' vii
I I The multinational enterprise, institutionsand 21 ExploringWestern and Chinese business relationship
corruption 17¢ paradigms 515
ll'Ittl'IiiltI 1l’It.‘GtlIiIilt’.t‘.t‘oralMclniie! Deiiiii'ho_e Drirrit/t_t* .rl. Yen nnrlBi'rir//i.*_v R. Bnrne.r
2.2 Reforms in Russian corporategovernanceand
PART ll INSTITUTIONS AND CONTEXT: DEVELOPED evaluation ofRussian boards ofdirectors 533
ECONOMIES Difelli Deiiiirlin.r, Aiirli'e_y I’ii/rhriiirievoiidRoninn Sieponov
23 Firms, marketsand the social regulation oicapitalism
I2 The role oi"the MNE headquarters in subsidiary in sub-Saharan Africa 555
innovation: an institutional perspective FIJI} Gt/ton K/i:i'clc
Kieiviii M. Coni'o_yniidDtl'I'.ii‘/G. Cti//iiig.i'
I3 Partial or full acquisition: influencesoliinstitutional lift’/tilt‘ 595
pressureson acquisition entry strategy ofmultinational
enterprises 't""Ii
Altninrl.i‘Ii'.‘i‘/tilt niirl.Ioi'nin Lnrinio
I4 Managing improvisational practice: the tension between
structureand creativedillerence 344
Ho!/_v Pri!i'ii'k, Griff Gi'i.’i,emidNit‘ Beech
PART III INSTITUTIONS AND CONTEXT: EMERGING
AND DEVELOPING ECONOMIES
I5 South South foreign direct investment: key role of
institutionsand future prospects 3-£35
/Irefe Giroiirl. Hnji: Mir:unnrlKt’t’ Hivee Wire
I6 Internationalization, institutionsand economicgrowth:
a fuzzy-set analysisofthe new EU memberstates F’-B1
Moi‘!/ten’ M.C. /I//ennntlMriiiri L. A/r/i'ed
I7 Financial system and equity culture development in
Central and Eastern European countries: theelTect oi‘
institutional environment dliit
Ziin Stone. Fi'iiglri'.i'lt'ri.i'Fili;1;iiii'o.i'urn!Corinen Sioinn
I8 Between welfare and bargaining: union heterogeneity in
Europe's ‘Far East" rlilit
Ri'i'lioi'rlCivnrchei'riin!C/iiiirtiri {l'Itii'I'i.t'trlI
I9 Explaining persistenceofdysiunctionality in
post-Coinmunist transformation diiii
llrlnrnir Upt'hiri'r!i
20 Theco-evolution oithe institutional environmentsand
internationalization experiencesofTurkish
internationalizingfirms 433
Bri/iririni Kiii'ndeiiii'i'onrlrlfli/it l’inii'nI-:
Criiiiii/iiiiiii'.i' ix
David G. Collings is Professor of IIRM at Dublin City University. I-Iis
Contributors
research interests focus on the management of MNEs with an empha-
sis on stalling and talent issues. I-Ie is a co-editor of I-Ininon Re.rrnin:'e
MrinrigeiiieiirJoiiriiul.
KieranM.Conroyisa Doctoral researcherinthedisciplineofManagement
at the National University ofIreland Galway. I-Iis research focus includes
Maria L.AldredisaSeniorLecturerin International Business, Manchester
an interest in the strategic management of MNE subsidiaries with a par-
Metropolitan University Business School.
ticular emphasis on the application ofan institutional perspective to this
Franklin Allen is the Nippon Life Professor of Finance and Professor of domain.
Economics at the Wharton School ofthe University ofPennsylvania. I-Ie
RichardCroucheris ProfessorofComparative Employment Relationsand
is a past President of the American Finance Association and a Fellow
Associate Dean Research at Middlesex University Business School and
of the Econometric Society. He received his doctorate from Oxford
Visiting Professor at Cranlield School of Management. He is the author
University.
with Elizabeth Cotton ofGlolhol Urir'oii.r, GlobalBir.~lfne.i.r(Endedition pub-
Matthew M.C. Allen is a Senior Lecturer in Organization Studies, lished by Libri Publishing. 20] l).
Manchester Business School, The University ofManchester. His research
Alvaro Cuervo-Cazurra is Associate Professor of International Business
covers comparative employment relations, business systems. multina-
and Strategy at Northeastern University. I-Iis research focuseson interna-
tional corporations, employment relations and lirm performance, and
tional strategy, with a special focus on developing cotintry multinational
institutional theory.
lirms. and governance, with a special interest oncorruption. He received a
PhD from the Massachusetts InstituteofTeehnology.
Ahmad Arslan is Post-doctoral Researcher at the Department of
Marketing. FacultyofBusinessStudies. UniversityofVaasa, Finland. I-lis
Mehmet Demirbag is Professoroflnternational Business in the School of
research interests include FDI strategies ofMNEs especially in emerging
Management at the University ofShellield. I-Iis current research interest
economies, impactsofinstitutionalenvironments, institutional theoryand
focuses around MNEs from emerging markets, offshore R&D activi-
new institutionaleconomics.
ties of MNEs, impact ofinstitutional factors on MNEs‘ operations. Dr
Demirbag also has extensive experience in policy development having
Bradley R. Barnes is Professor of International Management and
served as principal advisor for the Turkish Ministry of Industry and
Marketing at the University of Shellield Management School. Prior to
Trade. "
thathewasthe Hong KongEndowedChairofInternational Management
at the University of Kent. I-lis research is mainly in the area ofinterna- Dilek Demirbas is a Reader in Strategic Management International
tional business relationships, focusing on Chineseeconomies. Prior to his Business subject group at Newcastle Business School, Northumbria
academic career, Dr Barnes worked forover ten years in an international University. She teaches International Business and Economics.
marketingcontext.
Fragkiskos Filippaios is the Director for Postgraduate Development and
Nic Beech. Professor of Management Dean of Arts. at the School of Accreditations and a Senior Lecturer in International Business at Kent
Management University ofSt Andrews. His primary research focuses on BusinessSchool, UniversityofKent. Hisresearch interestsareon theroles
thestudy ofidentity. ofsubsidiariesoflvlultinational Enterprises,thelocation strategiesofmul-
tinationals’ subsidiaries, the role oftechnology in themultinational group
Jack A. Clampit is a PhD Candidate and research assistant at the Wang
and theempirical assessment ofForeign Direct Investment.
Center for International Business Education and Research (CIBER),
where he studies the link between institutions and MNE conduct and Marc Fovargue-Davies is a Strategy Consultant and Research Associate
performance (includingdistal relationships, e.g., institutional antecedents ofthe London Centre forCorporateGovernance and Ethics at Birkbeck.
and societal outcomes). UniversityofLondon.
I'ffI
L
it i'iii'!.f!infoiirrfrippi'ouclie.rno i'niei'iinn'oiiril/JII.'i‘fIIc‘.i'.'i' Criii!i'i'/ni!rii*.i' xi
Nolan T. Galfney is a PhD Candidate and research assistant at the Wang Education and Research (CIBER) at the University of Memphis. I-Iis
Center for International Business Education and Research (CIBER), research interests include Cross-Cultural Management and International
wherehestudiesthe impactofinstitutionson EMNEsinvolved in mergers Business Strategy.
and acquisitions.
GiltonKlerck isAssociateProfessorin Industrialand EconomicSociology
Mehmet Erdem Gene is an Assistant Professor of Management at at Rhodes University in Grahamstown, South Africa.
Montclair State University. His research focuses on how country institu-
Sue Knnzelmann is a Reader in Management and Directorofthe London
tional environments alfcct the strategic behavior and performance of
Centre for Corporate Governance and Ethics at Birkbeck, University
multinational lirms. Originally a native of Turkey, he holds a PhD in
of London; she is also a Research Associate of the Centre for Business
Strategic Management from the University ofMinnesota.
Research at Cambridge University and the Higgins Labor Research
AxeleGiroud isa Senior Lecturerin International Business at Manchester Centreat the University ol'Notre Dame.
BusinessSchool. Shehasconductedseveral research projectson Asianand
Jorma Larimo is Professor of International Marketing and Vice Dean of
multinational firms‘ activities in the region. She is interested in issues of
Faculty ofBusiness Studies at the University ofVaasa. Finland and part-
knowledge transfer. multinational firms’ linkages in host economies and
time Professorat the Faculty ofEconomics and Business Administration
multinational strategies in Asia.
at the Tartu University, Estonia. His research interests include FDI,
John Godard is a professorat the University ofManitoba. I-lis main inter- market entry and divestment strategies of MNEs. internationalization
est is in the implications of work and employment for broad issues of ofSMEs, Management and Marketing Strategies in Central and Eastern
economyandsociety, and how theseimplicationsvary in accordancewith Europe, International Retailing and Role of Culture in International
national institutional environments. BusinessOperationsofFirms.
Gail Greig is a lecturer in the School of Management at the University
Martina McGuinness is a lecturer in the Management School at the
ofSt Andrews. Her PhD focused on the role ofcontext in organisational
University of Shellield. Iler research interests include risk and organi-
learning from an activity theoretical perspective. Current research inter-
sational resilicnce with a particular focus on the impact ofenvironmen-
ests concern relations between management practice and professional!
tal uncertainty upon international business. She is currently involved
othercore work practices.
in an ESRC funded project on risk, resilience and governance which
Nigel Hawortlt is Professor of Human Resource Development in the seeks to create links between academics and practitioners working in
UniversityofAuckland in New Zcaland. this field.
Jasper .I. Hotho is Assistant Professor at the Copenhagen Business Brendan McSn'eeney is Professor of Management at Royal I-Iolloway
Schoofs Department of Strategic Management and Globalization. His College, University of London and Visiting Professor at Stockholm
main research interests include the internationalization process of lirms. University.
MNE knowledge processes and the ellects and measurement of institu-
Hafiz Mirza is Professor of International Business at the University of
tional dilferences.
Bradford School ofManagement and a Chiefin Division on Investment,
Steve Hughes is ProfessorofInternational Organisationsat the Newcastle at the United Nations Conference on Tradeand Development, Geneva.
University BusinessSchool.
Glenn Morgan is Professor of International Management at Cardiff
Bahattin Karademir is Assistant Professor of Management and University, Cardilf Business School. His current research interest centres
Organizations at Cukurova University. Adana, Turkey. I-lis research around comparative management and the impact ofglobalization, insti-
interests include business groups in emerging markets. internationaliza- tutional change. institutions and markets. particularly the regulation of
tion ofemerging market lirms, and emerging market multinationals. linaneial markets.
Ben L. Kedia is the Robert Wang Chair of Excellence in International Claudio Morrison is Senior Research Fellow at Middleseii University
Business. and the Directorofthe Wang Center for International Business Business School. Previously based at Warwick University, his research
-_i
xii !ii.ru'tiiiirinrilri_npi'rnii:'/ie.rno fiiierniilionnlfni.ri'iie.i'.r C'riiiii'f1iiitoi'.i' xiii
focuses on management change, labour relations and more recently governance, firm finance, and firm level work and employment relations.
migration in theCIS. Whilst much of the contemporary institutional literature draws distinc-
tions between national contexts based on stylized ideal types, macro-
I-lolly Patrick is a doctoral candidate at the School of Management.
economic trends andior limited panels ofcase studies, his work brings to
University of St Andrews. Her primary research focuses on the episte-
bear systematic comparative firm level evidence. At a broader theoretical
mological construction oflegitimacy in cultural industries. primarily the
level. his work encompasses explorations ofthe bounded nature ofinter-
theatre industry.
nal diversity within national capitalist archetypes, and, more recently,
Torben Pedersen is Professor at SMG, Copenhagen Business School. I-Ie institutional crises and change. In his recent work, he has linked broader
has published over I00 articles and books concerning the managerial systemic crises with energy transitions, and the extent to which the latter
and strategic aspects ofglobalization. He is co-editor of Glohnl Sn'nreg_v favours ownersofmore fungibleassets.
Jioiiiviriland Ar/rniii.'e.rin I'niei'iiiiti'oiirilMoiiiigeiiieiii.
Attila Yaprak is Professor of Marketing and International Business at
Roman Stepanov is a senior lecturer in Accounting and Financial Wayne State University, Detroit, Michigan, USA and a Network Faculty
Management subject group at Newcastle Business School, Northumbria in Marketing at Sabanci Ifniversity, Istanbul, Turkey. He is a winner
University. He teaches Accounting. International Financial Management of many teaching awards, including the 2007 Outstanding Marketing
and Corporate Governance. Teacher Award given by the Academy of Marketing Science, and the
President‘s Award for Excellence in Teaching given by Wayne State
Carmen Stoian is a Lecturer in International Business at Kent Business
University.
School, University ofKent. l-Ier research interests are on the institutional
determinants offoreign direct investment in Central and Eastern Europe, Dorothy A. Yen is a Lecturer in Marketing and International Business,
the location decisions by multinationals expanding in post-communist at Brunel University. She completed her master‘s degree and PhD at the
economies and the cultural differences and their impact on international UniversityofLeeds. Herresearchareaisin Chinesebusinessrelationships.
business. DrYen hasseveralyearsofbusinessexperience havingworked in industry
in both Taiwan and the UK beforemoving into academia.
Zita Stoneisan Assistant Lecturerat Kent BusinessSchool, Universityof
Kent. Zita's research interestsareon theequityculturecreation inCentral AndreyYukhanaevisaLecturerinStrategicManagementand International
and Eastern Europeas well as the broaderareasofInternational Business Business subject group at Newcastle Business School. Northumbria
and Strategic Management. University. I-leteaches International Business, Strategic Managementand
Economics.
Martin Upchurch is Professor of International Employment Relations
at Middlesex University. London, UK. Prior to becoming an academic
he worked for the Department ofthe Environment and then for a public
sector trade union in the UK as a researcher andjournalist. He serves on
the National Executive Committee of the British Universities Industrial
Relations Association and is a member of the editorial board of Work,
Employment and Society.
Kee Hwee Wee is Economic Affairs Ollicer at the United Nations
Conferenceon Trade and Development, Geneva.
Geoffrey Wood is Professor of HRM in the School of Management,
University of Shellield, and Associate Dean of the School. He is also
Visiting Professor at Nelson Mandela Metropolitan University and
Honorary Professorofthe University ofWitwatersrand. Geolfs research
interestscentreon the relationshipbetween institutional setting,corporate
j-
l'rm'orltit-lion xv
ellectiveness ol‘ MNEs and their subsidiaries. alliance partners. supply
Introduction
chain providers etc. This is not a one way inlluence. rather. it refiects the
Geoffrey Woodand M6/I!??€l De:m'rbrrg multiple and complex relationship between structure and social action.
Depending on national institutional configurations, industrial organisa-
I |.|.- |_|u |-.l|I|l|I |_|.|.|-|.|.| Ii
tions and their relationship with other actors, in terms ofdegree ol' infin-
ence and interdependency, role of institutions and institutional factors
vary significantly between countries, regions and triad blocks.
There is a growing interest on the efiects ol‘ institutions on how firms Such institutional impacts on international business, which may create
manage, and how dillerences in embedded institutional configurations liability ol' Foreignness and therelore transaction costs for MNEs and
forcefirmstoadapt how they do businessaccording tocontext in dilferent their partners (Demirbag et al., 2007) should beexamined liorevery stage
partsol'the world. of international business operations and transactions including loca-
Institutions may beconceived oliin rational-hierarehical orrelationship tion choice, entry mode, creating alliances. organizational structure and
terms (Goergen et al. 2009). The liormer, grounded in rational choice eco- diversification, internal processes, outsourcing, supplychain and logistics,
nomiesassumes that thechoices rational actors make isframed byspecific environment management and CSR. managing innovation.
institutional incentives and disincentives (North I990; Peters 2005); it is Despite the infiuenceofeach school olthought, there has been remark-
held that, aboveall, ol'central importance is private property rights. Such ably little dialogue between each camp, and indeed, liew systematic
approaches are dominant in the economics and finance literature (North attempts to compare dillerences and build on common ground. And, the
I990; La Porta et al. I999). bulk ol'the literature within both camps has focused on the most prosper-
ln contrast. relationship or soeio-economic approaches to institutions ouscountriesofWestern Europe, North America and the Far East. There
reject the view that a single relationship (e.g. private property rights) will has been relatively less attention devoted to understanding the nature ol\-
overcode all others. Rather. what lirms do refiects complex webs of ties, Mediterranean capitalism and transitional economies. Finally, there has
involving notjust owners. but alsoemployees, associations, widersociety, been increasing attention on the alTeets ol' social action on institutional
and directly or indirectly, the state (Peters 2005). The literature on com- structures.
parativecapitalism suggests that themannerin which firms manage and The present collection brings together the work of leading scholars
indeed, conduct other social and economic relations within and beyond l'rom a range oli dilferent starting points. present recent synthetic work
the firm will depend on speeilic institutional configurations, and the and institutionally-inliormed accounts lirom transitional and emerging
particularcomplementaritiesmadepossible inaparticularspaceandplace markets, as well asmatureeconomies.
(l-lall and Soskice 200]; Whitley 2005; Hall and Thclen 2009). What in
practical termsthismeans is thata rangeol'dill'erentcombinationsol'rela-
tionships may prove equally Functional: the relative strength ofproperty THE STRUCTURE OF THE BOOK
rightsare not necessarily the most important institutional l'eature in every
context, and indeed, there arecontextswhere weaker property rights may The book is explicitly multi-disciplinary, encompassing perspectives from
prove more Functional than stronger ones (ibid.). Such approaches (most a range ol'the functional areas ofmanagement studies. However, all have
notably the ‘varieties olcapitalism‘ literature; Hall and Soskice 200]) has in common a rootedness in the broad political economy tradition and
been influential in both the literature on comparative political economy, an interest in the relationship between spatial and temporal dilferences
and increasingly within management studies. in institutional liramework and firm-level outcomes. The book consists
Institutional impacts on international business assume many dillerent of three parts. Part l contains l l theoretical chapters examining various
l'orms. While institutions in a country alTecl domestic lirms’ strategies. institutional approaches. Part ll consistsol'threechaptersofmoregeneral
structure and processes, they are equally important for multinationals and developed-country-oriented perspectives, while Part lll contains nine
enterprises’(MNEs)operation in thecountry(Whitley 2010). While home chapters related toemergingand developingeconomies.
countryinstitutionsinfluence MNEs(thewaytheyarecreated, developed, ln Chapter l. the editors locate the comparative analysis oli business
structured, and governed). host country institutions also determine the within recent directions in institutional analysis. The editors accord
.'w'v
-
XVI 1.0.5‘!fl’Hf!it'Hlt'-‘f£l'fJfJI'r1r:r'flL’.t' Inf!:!y,t':1{flf;,l;m[f1;;,1,';';;;_»_1;;,* 1nrrr:r!trt'rr'r:n xvii
particular attention to the nature of internal diversity within national
ofI-IRM. What is particularly welcome in thischapter is its nuanced eon-
institutional archetypes, theopen-ended, experimental and sidereal nature
eeptualizationofthe law that transcends the viewthat themost important
of institutional change, and the role of supranational institutions and
legal function is the protection ofprivate property rights.
actors. Finally, they argue that any comparative institutional analysis is
InChapter6, MeSweeneyexaminestheroleofsubjectiveculture(values)
incomplete without taking into account structural changes in global capi-
as the shaper of environments. McSweeney challenges the overarching
talism. In particular. they highlight the relationship between the present
power of singular cultural classifications and non-diversity arguments.
crisis and a long-term energy transition, with fundamental implications
I-le focuseson three types ofimagined communities, namely: civilizations,
for the deployment ofcapital.
countries and subnational monocultural groups. McSweeney develops a
Morgan, in Chapter2, focuses on the interaction between multination-
counterargument and critically examines claims about the cultural unity
als and national business systems. Morgan examines both varieties of
of these communities. This chapter is particularly valuable for all those
capitalism and international business literature and takes a closer look at
scholars who have felt vaguely unhappy with comparative accounts that
theinteraction between internationalizationandnational businesssystems
narrowly focus on culture, but have lacked access to a clear, concise and
within different types ofcapitalism. Thischapter pays special attention to
eloquent critique to disabusecultural-perspective fanatics.
institutionaldualityproblemsandimplicationsofinstitutionaldualityand
In Chapter 7, Kedia et al. criticize the treatment ofinstitutions in some
conflicts forstandardization, efliciencyand learningat subsidiary level.
ofthe international business literature and develop a holistic framework
Allen. in Chapter 3, explores the role ofinstitutions in financing in dif-
exploringthelinksbetweeninstitutions, multinationalenterprises(MNEs)
ferent countries. The author examines issues of investment and saving,
and levels ofeconomic development. Kedia ct al. draw on the works of
growth, risk sharing, information provision andcorporategovernance for
Douglass North and John Dunning and synthesize both streams of lit-
financial institutions in fivedifferent countries. Thechapter is particularly
erature via development of a model that explores the rich relationship
path-breaking in its firm foundations in thedisciplineoffinance. but with
between institutions and levels of economic development around the
its broadly encompassing nature, providinga vision and perspective that
world.
will enrich theanalysisolithoseworking in dillerentsubdisciplinesofbusi-
In Chapter 8, Haworth and Hughes examine the International Labour
ncssand management studies.
Organization (ILO). They focus on the concept ofDecent Work by iden-
In Chapter 4, Konzelmann and Fovargue-Davies explore the question
tifying key ILO responses to pressuresposed byglobalization and market
ofwhy the four main Anglo-Saxon countries experienced the 2008 finan-
liberalization. The authors also examine the role of Decent Work in the
cial crisis in dilferent ways. The authors argue that despite their similar
ILO‘s continuing attempts to influence other supranational institutions
cultural attributes, legal origins and institutional configurations, the four
such as the World Bank, World Trade Organization and the G20. This
main Anglo-Saxon countries experienced the 2008 financial crisis in dif-
account imparts a welcome nuance to counter those who see these bodies
ferent ways. This chapter goes on to analyse how political, ideational
as narrowly monolithic.
and historical factors led to dilferent approaches to the regulation ofthe
In Chapter 9, Cuervo-Cazurra and Gene provide depth to the concept
financial sector. economic liberalization policies and their effect on the
of distance in the international business literature. The authors separate
evolutionofcorporategovernance. Again, thischapterispath-breakingin
dimensionsofenvironment and theirassociated distancesinto three types,
that it Iirmly dispels the view that liberal markets constitute a monolithic
namely: obligatory, pressuring and supporting dimensions of environ-
and coherentcategory.
ment. Cuervo-Cazurra and Gene argue that the classification developed
In Chapter 5, Godard contributes to institutional environment
in this chapter challenges the assumption that distance is symmetric and
approachesandhuman resourcemanagement(HRM)debatesand focuses always has a negative impact on the MNE.
on cross-national variation in HRM practice and the context. The main
In Chapter I0, Hotho and Pedersen analyse institutional approaches to
argument in thischapteris basedon thenewinstitutional literatureand its
internationalbusinessandcriticallyexaminethevalueoftheseapproaches
relevance to cross-national variation in I-IRM. Godard develops a frame-
for understanding different aspects of international business activities.
work from an institutional perspective for studying cross-national dillier-
First, the authors focus on comparing and contrasting three domi-
ences in I-IRM. The framework developed in thischapterincludes the role
nant institutional approaches in international business studies, namely:
ofhistory in shaping variations in the national institutional environments new institutional economics, new organizational institutionalism and
-I-I-Ii