...of the Asia Research Centre or Copenhagen Business School. Editor of the Copenhagen Discussion Papers: Associate Professor Michael Jacobsen Asia Research Centre Copenhagen Business School Porcelænshaven 24 DK-2000 Frederiksberg Denmark Tel.: (+45) 3815 3396 Email: mj.int@cbs.dk www.cbs.dk/arc International Business Studies and the Imperative of Context. Exploring the ‘Black Whole’ in Institutional Theory Michael Jakobsen Associate Professor Asia Research Centre Copenhagen Business School mj.int@cbs.dk Abstract The aim of this article is to take a critical look at how to perceive informal institutions within institutional theory. Douglas North in his early works on institutional theory divided the national institutional framework into two main categories, formal and informal institution or constraints as he called them. The formal constraints consisted of political rules, judicial decisions and economic contracts, whereas informal constraints consisted of socially sanctioned norms of behaviour, which are embedded in culture and value systems. As formal constraints are straight forward to deal with the informal ones are much more vaguely defined and thus more difficult to grasp analytical. This imprecise perception of informal constraints is surprising as they basically constitute the foundation of the society in question, whereas formal constraints ‘only’ constitute...
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...Multinational enterprises A multinational enterprise (MNE) is a company that has a worldwide approach to markets and production or one with operations in more than a country. An MNE is often called multinational corporation (MNC) or transnational company (TNC). MNC as beauty - Potential contribution to economic growth and national welfare. - Important agent of change. - Increases competitive pressures on domestic firms. - Demonstrates and diffuses new technology. - Upgrades the quality of indigenous resources and capabilities. - Governments (in general) praise FDI. MNC as beast - Negative impact on the environment, labor and human rights. - MNCs’ and national state goals are not always compatible - MNCs out-compete local firms. MNCs have immense political power. 51 of the 100 biggest economies in the world are now MNCs. Business is in the driver’s seat, corporations determine the rules of the game and governments have become referees, only enforcing rules. Are MNCs really agents of technological change? Some scholars question the efficiency of MNCs, suggesting that they have become too large and bureaucratic to compete against more nimble and innovative smaller firms that are rapidly gaining advantage in highly competitive global markets. What is the three primary states of mind / attitudes toward the MBC? Ethnocentric (home-country oriented) - Home nationals are the best person to do the job - What works at home must work in the host country Costs: Fewer Innovations, lack of...
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...f e a t u r e a r t I C Le 647 Interaction Effects of Globalization and Institutional Forces on International HRM Practice: Illuminating the ConvergenceDivergence Debate By Yongsun Paik Irene Hau-Siu Chow Charles M. Vance In the face of globalization, scholars continue to debate about whether a convergence in human resources practices will prevail, or a trend of divergence perspective will persist. Building on institution theory, this article helps to explicate this debate by examining how globalization may interact with different dimensions of local institutional forces to lead to convergence, divergence, or crossvergence Correspondence to: Yongsun Paik, PhD, Professor of International Business & Management, Department of Management, Hilton Center for Business, Loyola Marymount university, One LMu Dr., Los angeles, Ca 90045-2659, 310.338.7402 (phone), 310.338.3000 (fax), yspaik@lmu.edu. Published online in Wiley Online Library (wileyonlinelibrary.com) © 2011 Wiley Periodicals, Inc. • DOI: 10.1002/tie.20440 648 f e a t u r e a r tI C l e in international HRM practices for enhanced performance. We also present useful propositions for guiding future empirical research and theory development on the interaction between globalization and different forms of local institutional forces, which in turn influence the formation of successful international HRM practices. © 2011 Wiley Periodicals, Inc. Int r o d u c t i o n N otwithstanding the current worldwide...
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...RELATIONS AND DIPLOMACY STUDENT GUIDELINE NOTES GLOBAL POLITICAL ECONOMY MODULE Paste the notes here… Political economy originally was the term for studying production, buying and selling, and their relations with law, custom, and government. Political economy originated in moral philosophy (e.g. Adam Smith was Professor of Moral Philosophy at the University of Glasgow), it developed in the 18th century as the study of the economies of states — polities, hence political economy. In late nineteenth century, the term "political economy" was generally replaced by the term economics, used by those seeking to place the study of economy upon mathematical and axiomatic bases, rather than the structural relationships of production and consumption (cf. marginalism, Alfred Marshall). History of the term Originally, political economy meant the study of the conditions under which production was organized in the nation-states. The phrase économie politique (translated in English as political economy) first appeared in France in 1615 with the well known book by Antoyne de Montchrétien: Traicté de l’oeconomie politique. French physiocrats, Adam Smith, David Ricardo and Karl Marx were some of the exponents of political economy. In 1805, Thomas Malthus became England's first professor of political economy, at the East India Company College, Haileybury, Hertfordshire. The world's first professorship in political economy was established in 1763 at the University of Vienna...
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...new products or building more branches. Each year, thousands of companies consider exploring new markets by expanding their operations into new geographical locations. According to Awe (2006) the drive to enjoy high-profit returns, and economies of scale are some of the primary reasons why companies keep migrating from one region to another. Stiff competition within the domestic markets may also force some firms to seek alternative markets. Given the importance of this process to the future of an expanding company, it is critical for the firm to take into account a number of the factors. This research investigates the importance of political forces, socio-cultural variables, and economic factors in the expansion process. The role of politics in promoting economic growth cannot be overlooked. Kay (2013) compared the economic performance of different countries with their levels of political democracy. The survey established that countries characterized by high degrees of political stability, goodwill, and democracy had better economic development statistics. In particular, the study compared the economic performance of Ukraine (a politically unstable country) and Uzbekistan (a stable country) over the last three years. Based on the World Bank’s statistics, it was established that the latter posted much better economic indicators (Hantula, 2012). It is because political institutions are responsible for the formulation of business regulatory policies. Therefore, politically stable...
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...drawn between the “historical” and the “rational choice” variants of institutionalism and shows that there are more points of tangency than typically assumed. However, differences remain in how scholars in the two traditions approach empirical problems. The contrast of rational choice’s emphasis on institutions as coordination mechanisms that generate or sustain equilibria versus historical institutionalism’s emphasis on how institutions emerge from and are embedded in concrete temporal processes serves as the foundation for the second half of the essay, which assesses our progress in understanding institutional formation and change. Drawing on insights from recent historical institutional work on “critical junctures” and on “policy feedbacks,” the article proposes a way of thinking about institutional evolution and path dependency that provides an alternative to equilibrium and other approaches that separate the analysis of institutional stability from that of institutional change. INTRODUCTION Institutional analysis has a distinguished pedigree in comparative politics, and the “new” institutionalist literature of the past two decades has both sustained this venerable tradition and deepened our understanding of the role of institutions in political life. At the same time, recent work has given rise to new debates. It is now conventional to distinguish three different varieties of institutionalism: rational choice institutionalism, historical institutionalism, and sociological...
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...the framework within which consumption choices are made, while general legal rules of tort, or wrongful harm, provide a post-hoc means of remedying a range of the possible damage or harm that might flow from consumption choices. Regulation enters the picture in both specific and general ways, all of which aim essentially to pre-emptively correct market failures that might harm vulnerable consumers. General statutory consumer protection rules (for example prohibiting certain terms in standard contracts, or unfair pressure in situations of unequal bargaining power) are supplemented by sector-specific statutory attempts to mitigate or prevent particular harms and risks that might be suffered by consumers, whether through poor water quality, contaminated food, morally offensive publications for children or the like. In this picture, regulation is the skeleton that gives shape and structure to a well-functioning market society. Regulation, as Karl Polanyi argued so eloquently many decades ago, constitutes the market. Neoclassical perspectives have in recent years adopted the Polanyian appreciation of the importance of institutions and in so doing have come to recognize the constitutive role of regulation much more fully than laissez-faire stereotypes might suggest. But the Polanyian resonance ends there, for the neoclassical image of regulation’s constitutive role is that it facilitates the development of an ‘active consumer’, mandating the provision of information and incentive...
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...Question: How does international political economy impact on your life in Belgium? Introduction International political economy also known as global political economy is an academic discipline within the social sciences that analyzes international relations in combination with political economy. As an interdisciplinary field it draws on many distinct academic schools, most notably political science and economics, but also sociology, history, and cultural studies. International political economy is concerned with the ways in which political forces (states, institutions, individuals, etc.) shape the systems through which economic interactions are expressed, and equally the effect that economic interactions have on political structures and outcomes. International political economy has various categories that help to describe and explain the different political and economic policies that various states, institutions and individuals may choose to be interested in. These categories are liberal, realist and Marxist. In this essay I will be exploring the different categories and the impact they would have on the international political economy of Belgium. History & Summary of Belgium Belgium is a constitutional, popular monarchy and a parliamentary democracy. It is a small, highly developed and densely populated country with approximately 10 million inhabitants at the cross-roads of Western Europe. Belgium is one of the founding members of the European Community, and its capital...
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...Second, it provides useful information for solving some of the important accounting problems that exist in the world. For example, it can help policymakers assess the prospects and problems of international harmonization; Third, it can assist in the training of accountants and auditors who operate internationally; And finally, it can enable a developing country to better understand the available and appropriate types of financial reporting by seeing other countries’ use of particular systems. By looking at other countries in its group it is possible to predict the problems that it is about to face, and the solutions that might work. When classifying international accounting systems, two main forms have been employed: one is the deductive approach, in which the approaches to accounting development are...
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...nternational political economy (IPE), also known as global political economy, is an academic discipline within the social sciences that analyzes international relations in combination with political economy. As an interdisciplinary field it draws on many distinct academic schools, most notably political science and economics, but also sociology, history, and cultural studies. The academic boundaries of IPE are flexible, and along with acceptable epistemologies are the subject of robust debate. This debate is essentially framed by the discipline's status as a new and interdisciplinary field of study. Despite such disagreements, most scholars can concur that IPE ultimately is concerned with the ways in which political forces (states, institutions, individual actors, etc.) shape the systems through which economic interactions are expressed, and conversely the effect that economic interactions (including the power of collective markets and individuals acting both within and outside them) have upon political structures and outcomes. IPE scholars are at the center of the debate and research surrounding globalization, both in the popular and academic spheres. Other topics that command substantial attention among IPE scholars are international trade (with particular attention to the politics surrounding trade deals, but also significant work examining the results of trade deals), development, the relationship between democracy and markets, international finance, global markets, multi-state...
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...Creative and Cultural Industries, MA Module: HUP057N What does a “political economy” approach to study of the Creative and Cultural Industries involve? What are its advantages and disadvantages? ID: 10048001 Anastasia Davydova 1. Introduction The intention of this paper is to define what we mean by political economy? What does this approach involve to study the Creative and Cultural Industries and what its advantages and disadvantages. This work will search through definitions, different schools and historical periods to better understand the background of Political Economy. Also this approach will be compared with another approach which examines cultural industries namely cultural studies approach to underline the main key point of political economy. This essay will briefly discuss specifics features of Creative and Cultural industries and moves to political economy approach itself with the final observation of advantages and disadvantages. “Culture is our business and business is our culture” [1] Definitions The term political economy addresses to relationship between politics and economy, how political power cooperate with economics, so politics responsible for the society and economy, in other words in charge of wealth of the society. Hence it is possible to declare that political economy examines the production and distribution...
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...GLOBALISATION ON HUMAN RIGHTS TABLE OF CONTENTS Contents INTRODUCTION ..................................................................................................................... 3 RESEARCH METHODOLOGY............................................................................................... 5 CHAPTER 1 GLOBALISATION ............................................................................................. 7 CHAPTER 2 INTERNATIONAL HUMAN RIGHTS LAW ................................................. 10 CHAPTER 3 IMPACT OF GLOBALISATION ON HUMAN RIGHTS............................... 13 Economic Rights .................................................................................................................. 13 Political Rights ..................................................................................................................... 17 CONCLUSION ........................................................................................................................ 21 BIBLIOGRAPHY .................................................................................................................... 23 Articles ................................................................................................................................. 23 Books .................................................................................................................................... 24 Miscellaneous .................................................
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...participants in the economy) and chronic fiscal imbalances (situation where all of the future debt obligations of a government are different from the future income streams) -Other issues: natural disasters such as 2011 earthquake in Japan, flood in Thailand, Political uncertainty in China and Middle East -Globalization has compounded the types and level of business risks. *Typical challenges that managers face involve politics, cultural differences, global competition, Terrorism and Technology. Managers in companies are struggling to find ways to balance their social responsibilities, their images, and their competitive strategies. -PESTEL- An analytical tool to develop and understanding of exogenous risk -Pestel analysis- Political, Ethical, Social, Technological, Environmental and legal understanding or environmental scanning that is CRITICAL if we are to strategically plan and develop our value proposition. -> Exogenous creates Endogenous RISK SWOT Analysis- an analytical tool that helps you develop an understanding of how exogenous risks influences endogenous risks for the firm The Global Business environment Globalisation- Global competition characterized by networks of international linkages between countries, institutions, and people in an independent global economy. Five key global trends: 1. Changing...
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...there is an issue with government subsidizing the arts. In Arts Funding: A New Approach, David Rawcliffe explains that government subsidizing would be necessary because the art market is subject to market failure. He explains that an accomplished arts industry creates national pride, leaves a legacy for future generations, contributes to education, encourages tourism, and that artistic innovation benefits other artists which isn’t protected by intellectual property laws (Rawcliffe). This means that an effective art industry has positive long term effects on a nation’s economy and society as a whole. Government subsidy also makes it possible for all to gain the benefits of art especially the lower income individuals that would normally be able to afford to attend art events (Rawcliffe). Another reason that the government should subsidize art is because generally the public wants them to as shown by a survey commissioned by the Scottish Arts Council. The survey found that 82% of the Scottish public believe that central government is responsible for the support of art and culture (Rawcliffe). From an economic stand point, it is argued that art institutions have the “character of public goods.” Since it is widely accepted that when more individuals can benefit at little to no additional cost from a service, government intervention can be justified as the service/good tends to be undersupplied by the market (Clotfelter). Another economic perspective in favor of...
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...underdevelopment’. The problem of poor countries is not that they lack the resources, technical know-how, modern institutions or cultural developments that lead to development, but that they are being exploited by capitalist countries. Dependency theory has a very different approach from most models of development. • It incorporates politics and economics in its explanation. • It takes into account the historical processes of how underdevelopment came about, that is how capitalist development began in one part of the world and then expanded into other areas. • It sees development as a revolutionary break, a clash of interests between ruling classes and the working classes. • It believes that modernisation does not necessarily mean Westernisation and that underdeveloped countries must set goals of their own, which are appropriate to their own resources, needs and values. However, it is a largely economic theory (from a Western perspective) seeing the outcome as a form of economic determinism. World systems theory World systems analysis is identified with Immanuel Wallerstein (1974) and is a way of looking at economic, social and political development. It treats the whole world as a single unit. Any analysis of development must be seen as part of the overall capitalist world economy, not on a country by country approach. Wallerstein argued that an approach...
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