Parenting Advantage in Business Groups of Emerging Markets

2007 ◽  
Vol 11 (3) ◽  
pp. 1-10 ◽  
Author(s):  
Anurag Mishra ◽  
M. Akbar
Keyword(s):  
Emerging Markets ◽  
Group Structure ◽  
Emerging Market ◽  
Business Groups ◽  
Developed Countries ◽  
Business Group ◽  
Managerial Practices ◽  
Developed Economies ◽  
Divisional Structure ◽  
Made In

The concept of parenting was originally proposed by Campbell et al (1995) in the context of conglomerates in developed economies. In contrast to the divisional structure of conglomerates in developed countries, business groups as found in most emerging consist of a network of affiliated yet independent firms. This difference in the structure of multi-business firms in developed and emerging markets solicits a revisiting the concept of parenting as originally proposed by Campbell et al. (1995). Does ‘parenting advantage’ exist in emerging markets? If so, what are the sources of ‘parenting advantage’? Given the multi-firm, multi-business group affiliated setup how does ‘parenting’ differ in emerging markets when compared to conglomerates of developed economies? How does the business group structure and associated managerial practices impact ‘parenting advantage’ of firms affiliated to a business group in emerging market? This paper examines some of these critical yet unanswered questions. The contribution made in this work is threefold… One, we redefine the concept of ‘parenting’ as relevant to business group structure found in emerging markets like India. Two, we articulate the drivers of parenting value for affiliate firms bound in a business group structure. Three, the paper discusses the nuances of parenting and its advantages in an emerging market, in contrast to its conceptualization in developed economies. Finally, extending the parenting literature to a wider context of an emerging market is an important outcome of this work.

The influence of motivations on international location choice in least developed, emerging and developed countries: evidence from Chinese MNEs

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Fernando Angulo-Ruiz ◽  
Albena Pergelova ◽  
William X. Wei
Keyword(s):  
Emerging Markets ◽  
Multinational Enterprises ◽  
Location Choice ◽  
Emerging Market ◽  
Developed Countries ◽  
Asia Pacific ◽  
Institutional Constraints ◽  
Least Developed Countries ◽  
Content Type ◽  
Developed Economies

Purpose This research aims to assess variations of motivations when studying international location decisions. In particular, this study aims to assess the influence of diverse motivations – seeking technology, seeking brand assets, seeking markets, seeking resources and escaping institutional constraints – as determinants of the international location choice of emerging market multinational enterprises (EM MNEs) entering least developed, emerging, and developed countries. Design/methodology/approach The authors develop a set of hypotheses based on the ownership–location–internalization framework and complement it with an institutional perspective. The conceptual model posits that the different internationalization motivations (seeking technology, seeking brand assets, seeking markets, seeking resources and escaping institutional constraints) will impact the location choice of EM MNEs in developed economies, emerging markets or least developed countries. This study uses the 2013 survey data collected by the China Council for the Promotion of International Trade and the Asia Pacific Foundation of Canada. The final sample of analysis of this research includes 693 observations. Findings After controlling for several variables, two-stage Heckman regressions show there is a variation of motivations when EM MNEs enter least developed countries, emerging markets and developed economies. EM MNEs are motivated to enter least developed countries to seek markets and resources. Conversely, those firms enter developed countries in their search for technological assets and to escape institutional constraints at home. While the present study findings show a clear difference in the motivations that lead to location choice in least developed vs developed countries, the results are not as clear for location in other emerging countries. Research limitations/implications The paper offers empirical support for the importance of motivations as crucial determinants of location choice. Originality/value This paper provides a detailed quantitative study on the internationalization location choice of EM MNEs based on their motivations. Though theoretical models underscore the importance of motivations, we know very little about how, in practice, motivations drive location choice. This study contributes to the international location choice literature a deeper understanding of how diverse motivations drive choices of expansion into developed economies, emerging markets or least developed countries.

Capital-Flow Volatility and Economic Openness: A Wavelet Approach

2020 ◽  
Vol 66 (4) ◽  
pp. 291-318
Author(s):  
Mihai Mutascu ◽  
Scott W. Hegerty
Keyword(s):  
Emerging Markets ◽  
Developing Economies ◽  
Trade Openness ◽  
Price Volatility ◽  
Developed Countries ◽  
Capital Flow ◽  
Developed Economies ◽  
Oil Price Volatility ◽  
Real Gdp

The paper analyzes the interaction between capital-flow volatility and trade openness in five developed economies and four emerging markets by applying wavelet analysis over the period from 1990Q1 to 2017Q1. The main findings reveal that, in the medium term, capital-flow volatility drives trade openness in emerging markets and developing economies. Special attention should be paid to developed countries during the 2008 economic crisis, when trade exposure is shown to have had significant effects on capital-flow volatility. In the long term, the direction of comovement is rather idiosyncratic in our set of emerging markets and developing countries. Moreover, in both groups of countries, the intensity and persistence of relationships are very sensitive to the volatility of real GDP and secondary to geopolitical risk and oil-price volatility.

scholarly journals Reallocation effects of recessions and financial crises: an industry-level analysis

2016 ◽  
Vol 16 (2) ◽  
Author(s):  
Fabrizio Coricelli ◽  
Aikaterini E. Karadimitropoulou ◽  
Miguel A. Leon-Ledesma
Keyword(s):  
Emerging Markets ◽  
Emerging Economies ◽  
Financial Crises ◽  
Value Added ◽  
Developed Countries ◽  
Large Set ◽  
Allocation Of Resources ◽  
Developed Economies ◽  
Manufacturing Sectors ◽  
Level Analysis

AbstractWe characterize the behavior of disaggregate manufacturing sectors for a large set of developed and emerging markets around recession dates. We uncover some relevant stylized facts. The dispersion in value added (VA) growth rates in developed economies is counter-cyclical, whereas for emerging countries it is pro-cyclical. Recoveries are more productivity-driven in developed countries as opposed to employment-driven for emerging markets. Around recession episodes sectoral-level misallocation of resources does not significantly change in developed economies, whereas it increases in emerging economies during financial crises. Therefore, there is no evidence that recessions improve the allocation of resources across industries.

Small–Business Group Formation as an Entrepreneurial Development Model

2009 ◽  
Vol 33 (3) ◽  
pp. 645-667 ◽  
Author(s):  
Christian Lechner ◽  
Christophe Leyronas
Keyword(s):  
Small Business ◽  
Market Failure ◽  
Business Groups ◽  
Developed Countries ◽  
Business Group ◽  
Management Style ◽  
Medium Size ◽  
Entrepreneurial Firms ◽  
Theoretical Approaches ◽  
Related Diversification

Why do small–business groups in developed countries exist? Research has shown the strong economic impact of business groups throughout the world but remains heavily focused on large–business groups and on emerging economies. Theoretical approaches to explain the existence of highly diversified business groups range from market power to the resource–based view and include market failure, transaction costs, agency theory, and cultural embeddedness. These approaches, however, are not very appropriate to explain the existence of small to medium–size firms in developed countries. What we know is that these smaller groups exist and that they are largely the outcome of related diversification. We investigate relatively small and young–business groups organized in a holding structure. What are the perceived benefits of this kind of group for entrepreneurs and how can we explain the phenomenon theoretically? Based on case study research, we argue that the small–business group is both the outcome and the antecedent of growth. It enables, and helps to realize and manage the growth of entrepreneurial firms. The enabling function consists in increasing reputation, attracting complementary resources that facilitate the exploitation of new opportunities, overcoming overembeddedness, and dealing with coopetition (concurrent cooperative and competitive relationships with another company). The group is also the outcome of realized internationalization and related diversification. Interestingly, for the emergence of the small–business group, just as important as diversification is the integration of activities as well as the separation of closely linked activities. Finally, the small–business group corresponds to an entrepreneurial management style. The main contribution of this article is to link organizational structure to the management and growth of entrepreneurial firms.

Chinese multinationals’ FDI motivations: suggestion for a new theory

2019 ◽  
Vol 14 (1) ◽  
pp. 70-90 ◽  
Author(s):  
Byung Il Park ◽  
Taewoo Roh
Keyword(s):  
Mergers And Acquisitions ◽  
Multinational Corporations ◽  
Emerging Market ◽  
Developed Countries ◽  
Future Research ◽  
Foreign Direct Investments ◽  
Data Set ◽  
Content Type ◽  
Developed Economies ◽  
Chinese Mncs

Purpose The purpose of this paper is to complement the conventional international business (IB) theory, the OLI perspective, which is good at explaining the foreign direct investments (FDIs) undertaken by developed market multinational corporations (DMNCs). This study also suggests a new theoretical framework, namely, the OILL paradigm, that is able to encompass FDIs from emerging market multinational corporations (EMNCs) toward developed economies. Design/methodology/approach The data comprising 206 Chinese MNCs, which completed international mergers and acquisitions (IMAs), were obtained from Zephyr. By using these data, logical regressions are conducted to statistically confirm that we should not omit the learning motivation if we want to adequately understand the FDI phenomenon by encompassing investment flow from developing (or emerging) to developed countries. Findings The results based on this data set indicate that EMNCs often try to enter developed economies with the motivation to seek sophisticated foreign host knowledge that is not available internally. In particular, they tend to use IMA strategies when they want to learn from heterogeneity (i.e. inter-industry mergers and acquisitions) and absorb advanced technologies from DMNCs. Research limitations/implications By shedding light on the recent new trend in FDI (i.e. FDI from emerging countries to developed economies), the study provides useful theoretical implications, as well as suggesting scholarly contributions. However, we should acknowledge that there are some limitations to this study. First, the study explores only Chinese MNCs. Second, learning motivations need to be minutely and precisely measured by other studies. Third, this study argues that FDI from EMNCs to DMNCs is triggered by the former’s motivation concerning knowledge acquisition. However, the type of knowledge should be considered, and this is perhaps another avenue for future research. Practical implications Conventional IB theories, such as the OLI paradigm and internalization theory, have long sought to answer the question of why DMNCs go for foreign markets, in spite of the presence of the liabilities of foreignness, and focused on their main investment motivations (i.e. market-seeking, efficiency-seeking and resource-seeking motivations). For this reason, these theories do not adequately capture the primary FDI motivations of EMNCs, and consequently, they are unable to see the big picture when it comes to the FDI phenomenon. Based on this idea, the authors complement the well-known triad motivations (i.e. market-seeking, efficiency-seeking and resource-seeking motivations) by adding the knowledge-seeking motive and contribute to the evolution of IB theories by suggesting a new theory, which is the OILL paradigm. Originality/value The study contributes to the extant literature in the field of IB in two key ways. First, it examines EMNCs’ central motivations in conducting FDI where empirical research is sparse. By doing this, this paper attempts to solve the query indicated above (i.e. why MNCs choose FDI in spite of the presence of the liabilities of foreignness), and it offers a new theory (i.e. the OILL paradigm).

Cooperation as a vehicle for innovation: a study of the effects of firm size and industry type

2019 ◽  
Vol 23 (3) ◽  
pp. 329-347 ◽  
Author(s):  
Silveli Cristo-Andrade ◽  
Mário José Franco
Keyword(s):  
Firm Size ◽  
Professional Training ◽  
Service Sector ◽  
Technical Assistance ◽  
Manufacturing Sector ◽  
Emerging Market ◽  
Business Groups ◽  
Binary Logistic Regression ◽  
Developed Countries ◽  
Content Type

Purpose Based on firms’ need to remain competitive and dynamic in a scenario of constant change, the purpose of this paper is to compare the actors involved in cooperation for innovation between Brazilian small- and medium-sized enterprises (SMEs) and large firms (LFs), and also in two industries/sectors, manufacturing and services. Design/methodology/approach To achieve this objective, the database chosen was PINTEC, with data available from 1998 to 2014. The statistical analyses performed were binary logistic regression, descriptive statistics of the variables, correlation matrix and the difference of means. Findings The empirical evidence show that the firm’s characteristics (SME or LF) favour the use of one type of cooperation for innovation or another, highlighting SMEs’ proximity to their clients and LFs’ structures, tending to belong to business groups and having links to training centres and technical assistance networks. Research limitations/implications The theoretical contribution of this study lies in the evidence that types of cooperation for innovation can vary according to firm size and the type of industry/sector, and the practical contribution lies in pointing out the importance of clients for SMEs, and for LFs the importance of business groups, technical assistance and professional training centres. The importance of suppliers in cooperation for innovation stands out in the service sector, and that of clients in the manufacturing sector. Originality/value This study shows that the types of cooperation to innovation can vary according to firm size and type of sector, in an emerging market and with low rates of innovation. It is emphasized that most research on the subject has been carried out in developed countries or emerging Asian ones. Therefore, this study is innovative because it shows particularities of the Brazilian market that can subsequently be observed in other emerging markets.

The Netherlands

2018 ◽  
Author(s):  
Ferry De Goey ◽  
Abe De Jong
Keyword(s):  
Twentieth Century ◽  
The Netherlands ◽  
Case Studies ◽  
Present State ◽  
Statistical Data ◽  
Group Structure ◽  
Business Groups ◽  
Business Group ◽  
Organizational Form ◽  
Business History

This chapter presents an introductory and exploratory overview of the history and present state of business groups in the Netherlands, with an emphasis on large business in the twentieth century. Statistical data and overviews are complemented by case studies, in order to sketch the diversity in business groups among Dutch businesses. Although business groups were present throughout modern Dutch business history, they were never the dominant organizational form. Although some large multinationals can be classified as business groups and many smaller family businesses are business groups, little attention has been paid to the organizational form in the literature. The chapter cannot document general motivations for Dutch firms to opt for a business group structure but presents several case-specific and idiosyncratic reasons.

Chairpersons’ hubris and internationalization: evidence from emerging market’s family business groups

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Arpita Agnihotri ◽  
Saurabh Bhattacharya
Keyword(s):  
Family Business ◽  
Family Firms ◽  
Emerging Market ◽  
Business Groups ◽  
Business Group ◽  
Board Members ◽  
Content Type ◽  
Firm Internationalization ◽  
Family Business Groups ◽  
Micro Foundations

PurposeThis paper aims to explore the association between chairperson hubris and the internationalization of firms belonging to business groups in an emerging market, India, under the boundary conditions of business group internationalization and the tenure of independent board members. Design/methodology/approachArchival data of 163 Indian family firms over a five-year period were used. FindingsThe study highlights the significance of chairperson hubris in determining the internationalization of family firms in India and the influence that business group internationalization and the tenure of independent board members have on the chairperson hubris and firm internationalization relationships. Originality/valueAlthough literature exists on drivers of internationalization, micro-foundations theories such as chairperson hubris have been less explored in the international business literature, especially in the context of emerging markets. Contribution to Impact

Engineering the Roadmap of Reverse Innovation

2020 ◽  
pp. 745-755
Author(s):  
Pável Reyes-Mercado
Keyword(s):  
Product Development ◽  
Emerging Markets ◽  
Emerging Market ◽  
Developed Countries ◽  
Technology Planning ◽  
Reverse Innovation ◽  
Firm Level ◽  
Integrate Technology ◽  
Systematic Framework ◽  
Analyse Case

The reverse innovation concept has gained traction in the practitioner and academic domains since it alters the traditional view of innovations flowing from developed countries to emerging markets. Reverse innovations depart from the assumption that product development appeals to value offers with reduced performance and radically lower price points for consumers in emerging markets. Existing literature on reverse innovations has been limited to analyse case studies and anecdotic evidence but a systematic framework is needed to innovate in systematic ways. Drawing from the technology planning and forecasting, this paper proposes that technology roadmaps are suitable tools to analyse how a reverse innovation designed initially in an emerging market encroaches developed countries. At the firm level, roadmaps integrate technology planning, product development, and market aspects. Hence, they become suitable tools to design and commercialize products and services based on the reverse innovation paradigm.

Ageing in Emerging Markets

2016 ◽  
Vol 4 (1) ◽  
pp. 1
Author(s):  
Lady English
Keyword(s):  
Emerging Markets ◽  
Emerging Market ◽  
Developed Countries ◽  
Population Ageing ◽  
Full Report ◽  
Emerging Market Countries ◽  
The Usa

In January 2015, I attended the Emerging Markets Symposium on Ageing, held in Oxford, UK. A group of 50 experts, from 20 countries and a range of relevant disciplines, collaborated to produce recommendations designed to be of practical value to policymakers faced with the challenges of population ageing. The topic is timely because the proportion of the population over age 65 is increasing in Emerging Market countries at an accelerated rate; changes that developed over 150 years in developed countries such as Britain or the USA will occur over a period of 25 years in the Emerging Markets (EMs). This article will highlight the main themes from the Symposium and encourage interested readers to move on to the full report.

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