International Business: Economics and Anthropology, Theory and Method PDF
Preview International Business: Economics and Anthropology, Theory and Method
International Business International Business Economics and Anthropology, Theory and Method J. Peter Buckley Foreword by John H. Dunning First published in Great Britain 1998 by MACMILLAN PRESS LTD Houndmills, Basingstoke, Hampshire RG21 6XS and London Companies and representatives throughout the world A catalogue record for this book is available from the British Library. ISBN 978-1-349-26418-6 ISBN 978-1-349-26416-2 (eBook) DOI 10.1007/978-1-349-26416-2 First published in the United States of America 1998 by ST. MARTIN'S PRESS, INC., Scholarly and Reference Division, 175 Fifth Avenue, New York, N.Y. 10010 ISBN 978-0-312-21184-4 Library of Congress Cataloging-in-Publication Data International business: economics and anthropology, theory and method I Peter J. Buckley p. em. A collection of articles co-authored by Buckley and collaborators between 1992-1997. Includes bibliographical references and index. ISBN 978-0-312-2ll84-4 I. International business enterprises. 2. Competition. International. 3. Economics. I. Buckley, Peter J., 1949- HD62.4.1553 1997 338.8'8-dc21 97-34977 CIP Selection and editorial matter© Peter J. Buckley 1998 Foreword© John H. Dunning 1998 Softcover reprint of the hardcover 1st edition 1998 978-0-333-68750-5 Please see the Preface and Acknowledgements for full details of original publication. All rights reserved. No reproduction, copy or transmission of this publication may be made without written permission. No paragraph of this publication may be reproduced, copied or transmitted save with written permission or in accordance with the provisions of the Copyright, Designs and Patents Act 1988, or under the terms of any licence permitting limited copying issued by the Copyright Licensing Agency, 90 Tottenham Court Road, London WIP 9HE. Any person who does any unauthorised act in relation to this publication may be liable to criminal prosecution and civil claims for damages. The authors have asserted their rights to be identified as the author of this work in accordance with the Copyright, Designs and Patents Act I 988. This book is printed on paper suitable for recycling and made from fully managed and sustained forest sources. 10 9 8 7 6 5 4 3 2 I 07 06 05 04 03 02 01 00 99 98 To the 3 MCs Collaborators Extraordinaires Contents List ofA bbreviations ix Foreword by john H. Dunning X Preface and Acknowledgements xii Notes on the Contributors xiii Introduction xiv PART I THEORETICAL BACKGROUND: ECONOMICS AND ANTHROPOLOGY 1 Economics as an Imperialist Social Science with Mark Casson 3 2 Economics and Social Anthropology: Reconciling Differences with Malcolm Chapman 24 3 The Perception and Measurement of Transaction Costs with Malcolm Chapman 57 PART II INTERNATIONAL BUSINESS: THEORY AND METHOD 4 Theory and Method in International Business Research with Malcolm Chapman 89 5 An Economic Model of International Joint Venture Strategy with Mark Casson 106 6 A Longitudinal Study of the Internationalisation Process in a Small Sample of Pharmaceutical and Scientific Instrument Companies with Malcolm Chapman 140 vii viii Contents PART ill BUSINESS PROCESS DESIGN, INNOVATION AND KNOWLEDGE 7 Organizing for Innovation: The Multinational Enterprise in the Twenty-First Century with Mark Casson 161 8 The Economics of Business Process Design: Motivation, Information and Coordination within the Firm with Martin Carter 186 9 The Economics of Business Process Design in Multinational Firms with Martin Carter 217 10 A Longitudinal Study of the Management ·of Cooperative Strategies with Malcolm Chapman 246 11 Wise Before the Event: The Creation of Corporate Fulfilment with Malcolm Chapman 267 Index 287 List of Abbreviations BPR Business process re-engineering CEO Chief Executive Officer ESRC Economic and Social Research Council of Great Britain FDI Foreign direct investment GATI General Agreement on Tariffs and Trade GE General equilibrium IJV International joint venture IT Information technology MNE Multinational enterprise R&D Research and development TQM Total quality management WPM World product mandate WTO World Trade Organization ix Foreword It is my great pleasure to write a brief foreword to this book. I first came to know Peter Buckley as my research assistant at Reading University in the early 1970s; and I have since followed his increasingly distinguished career with the greatest of interest and admiration. He is now one of our most prolific, stimulating and influential writers on a wide range of international business issues, and has been at the very forefront of graduate teaching and scholarship in the United Kingdom. Peter's ideas and writings flourish particularly well when he cooperates with other scholars. Since the time he was at Reading and wrote his classical treatise with Mark Casson, on The Future of the Multinational Enterprise {Macmillan, 1976}, he has co- authored several books and a large number of articles with colleagues both from his home universities and elsewhere. This particular volume testifies both to Peter's own wide-ranging intellectual insights and his abilio/ to work with fellow academics bringing a somewhat different (but complementary} set of ana- lytical tools and perspectives to those of his own. The result is a product, the scope and quality of which, I am sure, considerably exceeds anything which any of the writers contributing to this volume could have accomplished by himself. One of Peter Buckley's abiding professional interests has been on the organisation of business - and particularly international business - activity; and this, indeed, is the main focus of the vol- ume. However, unlike many other studies on the subject, the authors adopt a holistic - dare I say eclectic - approach; and the book is all the better for it. In the first part of the volume, for example, they examine both the richness of economics as a unifying method of analysis for examining the organisation of value-added activity; and of how, in tum, this analysis can profitably draw on the thought processes and intellectual insights of social anthropology. Chapters 1 and 2 lead naturally into a critical evaluation of the role of transaction costs in determining the organisation of production and exchange in market-based economies. This is the central concept used by Peter and his co-authors to explain X Foreword xi the growth and changing form of multinational business activity over recent decades - including the emergence {or, perhaps more correctly, the re-emergence) of the joint venture as a major vehicle used by ftrms to service foreign markets and tap into foreign resources. Once again in Chapters 3-6 we are treated to a rich panoply of Peter's interests and professional skills, as the reader is presented with both analytical rigour, pragmatic empir- icism and careful judgement. Neither Peter nor his colleagues are 'ivory-tower' scholars. Rather, they deal with issues of the utmost relevance to corporate management; and they do so in a way which helps reconcile the very different mindsets of the academic researcher and the business practitioner. Nowhere is this more clearly demonstrated than in the ftnal part of the book which, in many ways, is the most interesting as it addresses some of the critical issues now facing multinational firms in today's knowledge-based and globalising economy. Questions relating both to the organising for innovation, and of innovation, of how the innovation process relates to the value activities of the innovating firm, of the changing motives for, and patterns of, internationalisation, and of the best way to manage the various inter-firm alliances which business managers per- ceive they need to undertake to advance their global competitive advantages, are all at the forefront of scholarly research. Indeed the ways in which they are perceived, evaluated and incorpo- rated into a firm's strategic vision are increasingly determining corporate success. This a remarkable set of essays; as well as being of the highest academic standard, the monograph shows (to me at any rate) the benefits of alliance formation among international business researchers, and as a result, I very much hope that the scholarly competitive advantages ofboth Peter and each of the three MCs will be enhanced. The University ofR eading jOHN H. DUNNING
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