|Authorised: Dean of School |[pic] |
|Owner: Dean of School | |
|Approved by: SQC | |
|Date: 28th June 2004 | |
|Revised: 17th July 2006 | |
|Ref: UWBS038a | |

UWBS038g Assessment Briefing for Students

|Academic Year: |Semester 1 |
|2013/2014 | |
|Module code: |6IB003 |Module title: |Dynamics of Multinational Companies |
|Subject Area: |International Business |Module Leader: |Dr. Mark Cook |

|Assessment brief number |Element |Weighting: |
| |(Please delete as appropriate) |50% |
|2. Individual report based upon a mini case study (part of the portfolio) | | |

Assessment Brief/ Task

| |
|The aim of this assignment is to foster an understanding of the impact of Global FDI. |
|You are to provide a well-presented and logically structured business report with answers to the two questions that appear at the end of the case |
|study. |
|Word length: 1,500 words. |
| |
|You answer must show evidence of research, be properly referenced and include a bibliography. |
| |
|Case Study |
| |
|Central to addressing the debate regarding the effect of IFDI on local innovation is to determine whether foreign entrants enhance the |
|innovativeness of local firms, or crowd out domestic innovation. One line of reasoning suggests that IFDI ought to lead to greater levels of local |
|innovation as a result of knowledge spillovers to local firms. In addition, foreign entrants provide local firms an incentive to innovate as a |
|means to compete, or in the case of vertical linkages, better to meet technical supply requirements. |
| |
|Another line of reasoning casts doubt on the positive impact of IFDI, suggesting that foreign entrants relegate local firms to less innovative, |
|less profitable market niches. Moreover, since foreign firms generally pay higher wages, foreign entrants might attract higher-skilled labour, |
|leaving domestic firms short on talent -- a key ingredient to innovation. Foreign entry can also reduce the expected returns to entrepreneurship, |
|creating a situation in which the best would-be entrepreneurs prefer to take employment with foreign firms instead of founding new enterprises. |
| |
|In order to address one aspect of this debate, we studied the effects of IFDI on productivity and innovation in the manufacturing sector of Spain |
|from 1990 through 2002.[1][2] During that period, Spain received nearly € 45 billion of IFDI in manufacturing.[2][3] And though Spain is not a |
|developing economy by traditional metrics, relative to its OECD counterparts, it is a laggard. Hence, Spain is considered a middle-income, |
|developed country;[3][4] and given its position between developed and developing markets, Spain makes an interesting setting in which to test the |
|relationship between IFDI and innovation. |
| |
|Interestingly, as IFDI increased in specific industries, Spanish manufacturing firms improved their productivity (both total factor productivity |
|and labour productivity). However, as IFDI rose in those same industries, Spanish firms subsequently applied for fewer patents and introduced fewer|
|new products. |
| |
|These findings highlight the importance of distinguishing between productivity and innovation when considering the net benefits of IFDI. |
|Productivity and innovation might not capture the same outcomes, and may therefore speak to two very different aspects of the debate. |
| |
|For example, productivity captures short-run improvements in allocative and technical efficiency. Therefore, to the extent that Spain lags the |
|global technological frontier in high-tech manufacturing,[4][5] we may simply observe productivity increases as a result of a catch-up effect -- |
|i.e., Spanish firms adopting the more efficient manufacturing techniques that entrants bring with them. |
| |
|Innovation, by contrast, may be a better indicator of the long-run consequences for growth. To the extent that IFDI crowds out local innovation, it|
|may fail to provide desired growth outcomes. IFDI may actually hinder the development of technological capabilities among local firms and, hence, |
|the long-term growth prospects of local economies.[5][6] |
| |
|Circling back to the issue of whether to encourage IFDI as a matter of policy, there is reason for pause. Our findings call into question whether |
|IFDI can serve as a long-run growth catalyst, or whether it simply offers a short-term fix. Sure, IFDI may spur job creation, increase tax revenues|
|and improve the productivity of local firms. Those outcomes benefit the host country and are welfare enhancing in the near term. However, as a |
|consequence of IFDI, local innovation may become impaired, dampening long run economic growth, development and social welfare. |
| |
|All things considered, there are potential tradeoffs between IFDI’s near-term benefits and its long-run costs. This is not to say that IFDI should |
|be discouraged. Rather, policies that subsidize foreign entry ought to be thought through carefully. Policymakers would be well served to pay |
|special attention to tradeoffs, and enact policies that are consistent with long-term development objectives.[6][7] |
|Source Jin, B, Garcia, F and Salomon, R (2013) Do host countries really benefit from inward foreign investment?, Vale Columbia centre on |
|Sustainable International Investment, No. 98, July 1st. |
| |
|What other costs and benefits might arise from Inward FDI (IFDI)? |
|Are these costs and benefits likely to be determined by country and firm level of development and |
|growth? Use examples to explain your answer. |

Important requirements

|(Delete where appropriate, if other please provide detail) |
|Mode of Working: individual |
| |
|Presentation Format: report |
| |
|Grade required to pass: To pass the portfolio overall you require a mark of 40% |
| |
|Assessment limits (words and presentation timings): no more than 1500 words |
|(in accordance with assessment tariffs) |
| |
|Insert the following detail: |
|Hand in date:20th June 2014, 12.00pm |
| |
|Assessment should be marked for the attention of: Relevant tutor at ERCI |
| |
|Preferred hand in location: As Specified by ERCI |
|Note: |
|Expensive or elaborate bindings and covers of written submissions are not required in most instances. (Refer to guidelines however in the case of |
|dissertations) |
| |
|Always submit an electronic copy of your written work as well as a paper copy. |
|Always keep a copy of your work. |
| |
|Always keep a file of working papers (e.g. photocopied articles) that support the sources used in your work. |

The following detail is important when:

Preparing for your assessment

Checking your work before submission

When interpreting your grade and feedback after marking. (Note that your work will not be returned to you so always keep a copy of your work for this purpose.)

|Learning Outcomes |A critical evaluation of the economic decisions of multinational enterprises |
|Tested | |
|(Insert detail) | |
| | |
| | |
| | |
| | |
|Assessment Criteria |Level of understanding, analysis, application and evaluation |
|(Insert detail) |Recommendation and conclusion |
| |The use of academic literature to underpin the analysis |
| |Structure and presentation of the assignment, including the use of the Harvard referencing system |
| | |
| | |
|Performance | |
|descriptors (by | |
|grade) (Insert |Indicator |
|detail) |% |
| |Work will often demonstrate some of the following features |
| | |
| |1 |
| |70-100 |
| | |
| |The work varies from very good (70-79%), excellent (80-89%) to outstanding (in excess of 90%). Very good, possibly outstanding or |
| |exceptional level of analysis, showing deep critical engagement with a comprehensive range of contextual material. Demonstration of |
| |independent thought resulting in creative responses to the assignment brief and some telling insights. Clear evidence of understanding of |
| |current scholarship and research based on an extensive range of relevant sources. Clarity of structure demonstrating complete focus of |
| |argument. Little or no obvious errors in referencing or grammar or syntax. Mature links made between relevant ideas, theories and |
| |practice. |
| | |
| |2:1 |
| |60-69 |
| | |
| |Clear links between theory and practice. Good coverage of assignment issues. Full understanding of core issues. Evidenced level of |
| |understanding of appropriate theory and concepts. Some small repeated errors in referencing or grammar or syntax as appropriate |
| | |
| |2:2 |
| |50-59 |
| | |
| |Identifies main issues and relevant theory. Coverage of most of assignment issues. Competent application of relevant theory and states |
| |obvious links to practice. Some repeated errors in grammar or syntax possibly failure to apply Harvard referencing standard correctly in |
| |places. |
| | |
| |3 |
| |40-49 |
| | |
| |Makes few links between theory and practice. Answers question in a very basic way. Describes relevant theory accurately, and some relevant |
| |ideas offered. Possibly failure to apply Harvard referencing standard correctly. Limited coherence of structure. |
| | |
| |Fail |
| |30-39 |
| | |
| |Some learning outcomes and / or assessment criteria not met. Inadequate content with issues not addressed; insufficient evidence of |
| |understanding of relevant theory and concepts and only partial understanding shown. Very limited application of theory. Use of extensive |
| |quoted passages is evident. Evidence of sufficient grasp of learning outcomes to suggest that the student will be able to retrieve the |
| |module on resubmission. |
| | |
| |Fail |
| |0-29 |
| | |
| |No learning outcomes fully met. No demonstration of adequate knowledge or understanding of key concepts or theories. There is no |
| |recognition of the complexity of the subject. Little attempt to engage with assignment brief and has not met learning outcomes. Inadequate |
| |demonstration of knowledge or understanding of key concepts, theories or practice. |
| | |
| | |

To help you further:

• Refer to module guide for contact details of module leader and Departmental Administrator • Resit details will be posted on WOLF

|Detail of tutorial inputs, etc. |Weeks 1 - 12 |
|Recommended reading and other sources |Buckley, P.J., & Casson, M.C. (2009) The internationalisation theory of the multinational enterprise: A|
|(Where different from module guide listing)|review of the progress of a research agenda after 30 years, Journal of International Business Studies, |
| |40, 1593-1580 |
| |Cantwell, J., Dunning, J.H., & Lundan, S.M. (2010) An evolutionary approach to understanding business |
| |activity: The co-evolution of MNEs and the institutional environment, Journal of International Business|
| |Studies, 41, 567-586 |
| |Erramilli, M.K., Agarwal, S., & Dev, C.S. (2002) Choice between non-equity entry modes: An |
| |organisational capability perspective, Journal of International Business Studies, 33(2), 223-242 |
| |Gorg, H., & Strobl, E. (2003) Multinational companies, technology spillovers and plant survival, |
| |Scandinavian Journal of Economics, 105(4), 581-595 |
| |Hennart, J-F. (2009) Down with MNE-centric theories! Market entry and expansion as the bundling of MNE |
| |and local assets, Journal of international Business Studies, 40, 1432-1454 |
| |Luo, Y. (2004) A coopetition perspective of MNC-host government relations, Journal of International |
| |Management, 10, 431-451 |
| |McGahan, A.M., & Victer, R. (2010) How much does home country matter to corporate profitability? |
| |Journal of International Business, 41(1), 142-165 |
| |Park, Donghyun and Estrada, Gemma Esther B. Bolotaulo, Developing Asia’s Sovereign Wealth Funds and |
| |Outward Foreign Direct Investment (August 1, 2009). Asian Development Bank Economics Working Paper |
| |Series No. 169. Available at SSRN: http://ssrn.com/abstract=1616970 |
| |Ravi Ramamurti (2011), New Players in FDI: Sovereign Wealth Funds, Private Equity, and Emerging-Market |
| |Multinationals, in Ravi Ramamurti, Niron Hashai (ed.) The Future of Foreign Direct Investment and the |
| |Multinational Enterprise (Research in Global Strategic Management, Volume 15), Emerald Group Publishing|
| |Limited, pp.137-165 |
| |Sharma, V.M., & Erramilli, M.K. (2004) Resource-based explanation of entry mode choice, Journal of |
| |Marketing Theory and Practice, Winter 2004, 1-18 |
| |Vrontis, D., & Papasolomou, I. (2005) The use of entry methods in identifying multinational companies’ |
| |adapt stand behaviour in foreign markets, Review of Business, 26(1), 13-20 |
| |Yao, S, Sutherland, D and Chen J. (2010) China’s Outward FDI and Resource-seeking strategy: A case |
| |Study of Chinalco and Rio Tinto, Asia-Pacific Journal of Accounting and Economics,Vol 17, 313-326 |
|If available insert checklist of issues for|A. General: (Completeness, word length, special requirements, etc) |
|student to consider before submission. |Construction: Structure, introduction, conclusion, visual presentation, etc. |
| |Have you provided an introduction for each item? |
| |Have you concluded by summarising your argument at the end of each item? |
| |Is the work well presented visually in terms of layout, fonts, and spacing, etc? |
| |Intellectual Argument: (Evidence used, clarity and structure of argument, etc.) |
| |Intellectual argument |
| |Have you supported your statements with appropriate "evidence"? |
| |Is the argument clear and structured? |
| |Source Materials: (Please refer to guidance you have received in Module Guide and Induction. Proper |
| |acknowledgment, correct identification of authors, etc, complete references or bibliography, use of |
| |Harvard system standards) |
| |Are the materials you have used properly acknowledged in your work? Does the main body of your work |
| |correctly identify authors and other detail (dates and where appropriate page references) as specified |
| |in the Harvard system standards? |
| |Can all your references be traced to your bibliography? |
| |Has the bibliography been prepared to Harvard system standards? |
| | |
| |B. Overall Review: (Re-read, assess impact, etc.) |
| |Self-assessment briefing checklist: worked example |
| |Re-read the assignment brief. Have you answered the brief set? Have you addressed every aspect of it? |
| |Refer to the previously issued grade descriptors and decide (realistically) the grade you want to |
| |achieve. (Honestly now) do the descriptions associated with that grade correspond with your work? If |
| |not what adjustments do you need to make? |

Avoiding Academic Misconduct

|Warning |
|Collusion, plagiarism and cheating are very serious offences that can result in a student being expelled from the University. The business school |
|has a policy of actively identifying students who engage in academic misconduct of this nature and routinely applying detection techniques |
|including the use of sophisticated software packages. |
|Avoid Collusion |
|The business school encourages group working, however to avoid collusion always work on your own in order to complete your individual assessments. |
|Do not let fellow students have access to your work before it is submitted and do not be tempted to access the work of others. Refer to your |
|module tutor if you do not understand or you need further guidance. |
|Avoid Plagiarism |
|You must use available and relevant literature to demonstrate your knowledge of a subject, however to avoid plagiarism you must take great care to |
|acknowledge it properly. You should therefore always use of the Harvard style referencing system in all cases. |
|(For further guidance go to www.wlv.ac.uk/lib and from the menu that then appears, make these choices in turn: Study skills, referencing, Harvard |
|Citation). |
|Plagiarism is the act of stealing someone else's work and passing it off as your own. This includes incorporating either unattributed direct |
|quotation(s) or substantial paraphrasing from the work of another/others. For this reason it is important that you cite all the sources whose work|
|you have drawn on and reference them fully in accordance with the Harvard referencing standard. |
|Extensive direct quotations in assessed work is ill advised because: |
|It represents a poor writing style that is unlikely to meet the pass grade marking criteria, and it could lead to omission errors and a plagiarism |
|offence could be committed accidentally. |
|Maximising the benefits of team working |
|Individual assessment must represent an effort prepared and submitted by you. It will contain your solutions to exercises set during the delivery |
|of the module. (Your submission may reflect some contributions arising from group working and classroom presentations). |
|Always: |
|Maintain a file of evident (e.g. academic papers used in preparing your assignment) |
|Submit an electronic copy (e.g. a disk or CD) of all written assessments in addition to paper copies. |

----------------------- [1][2] Francisco García, Byungchae Jin and Robert Salomon, “Does inward foreign direct investment improve the innovative performance of local firms?,” Research Policy, vol. 42 (February 2013), pp. 231-244.

[2][3] OECD Statistics Database.

[3][4] Guillén Mauro. The Rise of Spanish Multinationals: European Business in the Global Economy (Cambridge: Cambridge University Press, 2005). [4][5] Robert Salomon and Byungchae Jin, “Does knowledge spill to leaders or laggards? Exploring industry heterogeneity in learning by exporting,” Journal of International Business Studies, vol. 39 (January 2008), pp. 131-150.

[5][6] García, Jin and Salomon, op. cit.

[6][7] John Kline, “Evaluate sustainable FDI to promote sustainable development,” Columbia FDI Perspectives, No. 82 (November 5, 2012).