International Business Scholars Research Articles

Grand Challenges within IB: Conducting Qualitative Research in the Covid Environment

The new circumstances imposed by the Covid-19 pandemic create considerable uncertainty about the future nature of International Business (IB). This presents IB scholars with a ‘grand challenge’ of conducting research to inform theorizing about the new situation. Such research needs to be exploratory and highly sensitive to the nuances of new and evolving situations; in other words, qualitative and phenomenon-driven. We discuss the methodological implications of conducting qualitative research under the restrictions imposed by the pandemic and its aftermath. We argue that the IB discipline can use this disruption to remould traditional methodological practices and encourage technologically innovative methods.

Why the world economy needs, but will not get, more globalization in the post-COVID-19 decade.

Contractor argues that the coronavirus outbreak only had temporary effects on the global economy, and that post COVID-19 globalization will resume. We posit that the pandemic will have significant long-lasting effects on globalization. Our arguments are grounded in three observations. First, the pandemic has increased inter- and intra-country inequalities and has reversed trends in poverty reduction, which will intensify anti-globalization sentiments in the future. Second, the pandemic has fueled populism, nationalism, and the return of the interventionist state in the economy, which has paved the way for a rise in protectionism. Third, governmental responses to the COVID-19 crisis have undermined the multilateral institutions that have thus far facilitated globalization. These forces have resulted in growing global uncertainty and higher costs in international transactions. We argue that global value chains’ reconfiguration will result in a less globalized, and more regionally fragmented world economy. We conclude by suggesting two fertile opportunities for international business scholars: researching commitment failure in international transactions and studying resilience, as illustrative examples of lines of inquiry that can help explain why this latest pandemic will compromise trends in globalization that have dominated the world economy for a long time.

Global Migration: Implications for International Business Scholarship

Migration is increasingly viewed as a high-priority policy issue among politicians, intergovernmental organizations, NGOs and civil society throughout the world. Its implications for the private sector, for economic prosperity and for the cross-border activities of firms are undeniable and will remain a top priority for the foreseeable future. Yet despite its relevance to International Business (IB), migration has been subject to only limited discussion in the mainstream IB literature. In this contribution, we examine key aspects of migration germane to IB. In particular, we suggest that recent migratory shifts are transforming important elements of the context within which multinational enterprises (MNEs) operate with significant implications for the international human resource management practices of MNEs, for the way cross-border activities of firms are managed, and for the manner in which international strategies are formulated and implemented. We offer a research agenda to motivate IB scholars to study global migration in more depth and reevaluate the generalizability of aspects of their theories in light of developments in global migration.

Let me Google that for you – Measuring firm internationalization using Google Trends

In this research note, we propose Google Trends as a uniquely versatile and overlooked resource for International Business scholarship. Google search measures have been used successfully in other disciplines like epidemiology, finance, and political science. It offers highly reliable and finely grained data that not only provide a market-side complement to accounting based measures of firm internationalization in IB. Additionally, it opens entirely new research questions for IB research. In this research note, we survey the use of Google Trends in academic research, propose Google Trends-based measures of firm internationalization, discuss their empirical and conceptual benefits (and drawbacks) for IB research. We also provide an introduction to the R package globaltrends (Puhr, 2020) that accompanies this research note.

International business research and scholarship in the Middle East: developments and future directions

In this introduction we review the extant literature that demonstrate the importance of the Middle Eastern institutional and cultural context in shaping international business’s (IB) strategies and practices across several countries. Drawing on the literature, as well as the five articles included in this special issue, we (1) outline the state of socio-cultural, historical and economic forces that shape international business in several Middle Eastern nations; (2) utilize institutional theory to evaluate the constraints of international business practices in the Middle East; and (3) highlight the key gaps in the literature and the challenges faced by IB scholars and practitioners in the Middle East. We subsequently propose an agenda for future research in order to lay the foundation for international business scholars to advance the theorizing and application of IB practices in the Middle East context.

Defining and deterring corporate social irresponsibility: embracing the institutional complexity of international business

PurposeThis paper aims to put forward a definition of corporate social irresponsibility (CSI) which is relevant to the study of complex organizations and in particular, the multinational enterprise (MNE). This paper then offers a framework as a foundation to discuss the institutional complexity of CSI to aid international business (IB) scholars, practitioners and policymakers achieve a clearer understanding of the mechanisms that may penalize and subsequently deter MNE irresponsibility.Design/methodology/approachIn presenting the approaches taken by social regulation researchers and IB policy scholars to understand MNE irresponsibility, this paper proposes a definition of CSI and explicates the various mechanisms associated with deterring MNEs from behaving irresponsibly.FindingsTherefore, how can MNEs be deterred from behaving irresponsibly? To further the research agenda concerning CSI in IB, far less common are a definition of CSI relevant to the complex IB context; and a framework that explicates both the legal and social components of CSI, particularly as they unfold in a complex, diverse and often divergent institutional landscape. Overcoming these two primary obstacles is important because when complexities associated with CSI emerge, researchers need to be able to ascertain and expound upon what they are observing so that comparisons can be made and more MNE CSI research can be accrued over time.Research limitations/implicationsTo help the development of future research, we offered a more precise definition of CSI, one which is more relevant to the study of the MNE and the complex contemporary IB environment. By embracing complexities, this paper also outlines an institutional complexity approach, one which highlights both the role of formal and informal regulatory institutions. Though IB has traditionally focused on the role of formal regulation, there is much more to be unearthed by exploring the additional and concurrent influence of social regulatory institutions.Practical implicationsThere is a high level of heterogeneity in the motivations and modes used by MNEs to enter international markets, which likely influence efforts made by these firms to adapt to different types of formal and social institutional pressures. When firms invest significantly in a market, they have a greater economic dependence in that market and institutions have a greater opportunity to exert pressures. For instance, foreign direct investment requires a higher level of (longer-term) commitment, transfer of capital, exchange of expertise and learning, meaning that firms depend much more on local authorities to perform in the market and accomplish their goals.Social implicationsEnabled by new technologies and, particularly, social media platforms, stakeholders can now engage in organized forms of regulatory activities, as is evident in the lesbian, gay, bisexual, transgender, queer, black lives matter and gender equality social activist movements. Through prominent collective actions, the impacts of globally organized social movements may be increasingly non-location bound, placing MNE managers at the heart of new challenges and opportunities to engage with global stakeholders. Infomediaries such as the press, have always been of historical importance, due to their role in shaping stakeholder expectations and opinions of the firm and thus, the reputation and legitimacy of that firm.Originality/valueThis study enriches the understanding of what CSI is, why we are likely to observe it in practice and how it affects MNEs. This paper offers a definition of CSI that is sufficiently nuanced to capture the complexity of the contemporary IB environment, as well as a framework that, this paper proposes, presents a clearer understanding of the institutional mechanisms that may deter MNEs from behaving irresponsibly. By encouraging scholars to examine the institutional complexity of MNE CSI, the paper hopes to contribute toward building a bridge which connects the IB policy and social regulation research streams.

Bringing Research Closer to Reality: Configurational Analysis and Practical International Business Research

International business (IB) research focused on practical insights requires analytical techniques that come closer to reality by embracing complexity. In this article, we discuss Qualitative Comparative Analysis (QCA), a configurational technique researchers can leverage to study complex causal patterns in IB phenomena. We briefly review the basics of QCA, provide an example of how it can be applied to study practical IB issues, and outline the first steps for researchers situated at the intersection of IB practice and scholarship. Employing such techniques may make applied IB research even better positioned to make impactful contributions to practice and society.

The long-term energy transition: Drivers, outcomes, and the role of the multinational enterprise

The pre-eminence of the production and consumption of nonrenewable fossil fuels is waning with the growth of renewable energy solutions. This long-term energy (LTE) transition is one of the global grand challenges, characterized by uncertain and evolving markets. Although this is a global issue, there are regional differences and non-linear trajectories that suggest that the LTE transition is a complex challenge for firms and countries. For international business scholars, questions related to the role and effect of multinational enterprises in the context of the LTE transition have opened new avenues for advancing theoretical, managerial, and policy understanding. Thus, we advance this body of research by presenting a framework that delineates important drivers and outcomes of the transition. In this way, we emphasize how MNEs both influence and are being influenced by the LTE transition. We identify theoretical perspectives that may be useful to address LTE transition challenges, and suggest avenues for future research on this global grand challenge.

What\u2019s so special about born globals, their entrepreneurs or their business model?

There is near unanimity among international business scholars that it takes more time to expand internationally than domestically. Hence, this is why some are puzzled by born globals (BGs), firms that make large foreign sales at birth or shortly afterwards. Explanations given for this “anomaly” are that BGs have exceptional resources—advanced technologies and a high international orientation on the part of their entrepreneurs, and that they rely on cheaper internationalization strategies like the Internet and networks. What is almost completely overlooked is the role of the BG’s business model (BM). We analyze the time it took for a sample of Italian SMEs to reach BG status (25% foreign over total sales) within a three-year time span. Entering both international entrepreneurship (IE) and BM variables, we find that, among the IE variables, a firm’s technological intensity, the number of years their founders studied abroad and their foreign language fluency, as well as their use of domestic networks, are statistically insignificant. Variables measuring a firm’s focus on a niche BM, on the other hand, are statistically significant, along with the international work experience of the founders, with the niche BM explaining a higher level of variance with greater accuracy.

Hierarchical modelling in international business research: Patterns, problems, and practical guidelines

International Business (IB) phenomena often encompass activities at the nation, industry, firm, and individual levels. Consequently, empirical analyses in IB often consider at least two levels of analysis; failing to do so represents omitted variable bias. In this Perspectives paper, we review and evaluate the use and misuse of multi-level methods in IB, suggesting that IB scholars often fail to employ explicitly multilevel approaches when confronted with multi-level phenomena. We also assess different multi-level modeling techniques, noting that despite different nomenclature, many are functionally equivalent, and offer suggestions for best practices in the deployment of multi-level methods in IB.

Needs Analysis for Designing a Specific English Language Course for the Undergraduate Accounting Students in UPM

Today’s international business scholars treat language as an issue at the heart of their subject area (Mughan 2015), as English language’s irreplaceable position as means of communication is considered essential for international businesses. Nevertheless, one of the main concerns of educational specialists is the relevance of their programmes to the graduates’ success in today’s highly competitive labour market. With that, a needs analysis study was sought to explore the English language needs of undergraduate accounting students at Universiti Putra Malaysia. A survey method was employed to 20 undergraduate accounting students for the purpose of this study. The data collected from the survey were analysed quantitatively using SPSS 22 programme. As the findings of this study pointed out, the participants prefer to be taught more in listening, speaking and writing skills as the needs for their study and future career. Henceforth, a highly structured ESP course for accounting students with integration of language skills, subject or field-special skills, derived from their needs should be designed.

Sales growth or employment growth? Exporting conundrum for new ventures

Purpose Previous studies primarily focus on how to achieve better performance in the international markets, but few centers on whether internationalization is a promising strategy for new ventures’ growth and development. Based on two pioneering frameworks Conservative, Predictable, and Pacemaker (CPP) model and the 7-P model, this paper fills this gap by analyzing how exporting exert heterogeneous effects on two types of growth, sales growth and employment growth. Accordingly, this paper aims to favor market-oriented new ventures to make a strategy on expanding international markets. Design/methodology/approach This study is based on firm-level data from the Chinese Industrial Enterprises Database. The year 2005 was used as the shock year. By conducting the propensity score matching method, 793 couples of matched new ventures were collected with sales growth and 686 couples with employment growth. The difference-in-differences method was applied to analyze the various influences that exporting has on new ventures’ sales growth and employment growth. Findings The main finding of this paper is that new ventures that exported can achieve better sales growth than their counterparts that only operated domestically, whereas new ventures that remain in the domestic market have no difference in employment growth from those that exported. Research limitations/implications This study shows that exporting is especially beneficial for market-seeking new ventures. Because the study is based on Chinese data, scholars of international business can conduct further research on other countries with different economic structures. Originality/value Theoretically, this paper contributes to both international business theory and entrepreneurship theory by combining the CPP model and the 7-P model. Practically, this paper shows that exports mainly benefit the sales growth of new ventures. This suggests that business practitioners should consider their growth goals before they choose to enter the global market.

Using the Resource-Based View in Multinational Enterprise Research

The resource-based view (RBV) has evolved into a preeminent theory of strategic management. It is widely used by international business (IB) scholars since there is considerable synergy in core research questions pursued by IB and strategy researchers. However, in research on multinational enterprise (MNE) behavior, the use of RBV remains limited relative to other influential perspectives, such as the eclectic paradigm, the Uppsala model, and institutional theory. This is not surprising since the RBV was developed to explain performance differentials between country-centric firms with dominant product businesses rather than large MNEs with an expansive product-geographic scope. We describe how these limitations arise from the wider range of outcomes and explanatory variables, multiple levels of analysis, and the spatial, economic, and institutional barriers that are relevant to MNEs. We discuss the application of RBV to MNE research by the first author and other IB scholars. We then provide directions on how future research could use RBV more fruitfully to examine MNE performance and sources of competitive advantage in several areas. These include diversified corporations, subsidiary agglomeration, emerging market MNE internationalization, subsidiary autonomy, international joint ventures and alliances, and corporate social responsibility. Drawing upon teaching case examples from the first author’s work, we also point to the effectiveness of RBV in teaching with business cases, given its focus on firm performance (strategy).

Assessing the Belt and Road Initiative as a narrative: Implications for institutional change and international firm strategy

This article explores the role of narratives as drivers that guide the institutional change associated with globalization and deglobalization. For China’s Belt and Road Initiative (BRI) to succeed as a driver of institutional change in favor of globalization, it must pass the narrative “virality” test and successfully contend with competing narratives. Rival narratives will be launched by firms and organizations worldwide that expect to win or lose from deglobalization or from new forms of globalization. This study develops a useful framework for establishing the extent to which China’s BRI is a genuine narrative or just a story. In this regard, four testable propositions are put forth to ascertain whether the BRI is values-based, extends an invitation to participate, is open-ended, and is associated with economic performance for both Chinese and non-Chinese participants. The analysis of the BRI-related institutional change that leads to globalization applies a theoretical lens centered on the narrative economics perspective and on the institution-based view and political economy perspective. Implications for BRI stakeholders, international business practitioners, and international business scholarship are outlined.

Chinese MNE acquisition of unrelated foreign businesses: The role of diversified business group affiliation, private ownership and strategic asset seeking

While the acquisition by Chinese firms of unrelated foreign businesses has become quite common, it is a highly risky undertaking not fully explained by international business scholars. Using resource-based and institutional theory, we hypothesize that affiliation with a domestically diversified business group confers pre- and post-acquisition advantages and legitimacy, fostering unrelated foreign acquisitions. In addition, we argue that private ownership as well as a motive to seek strategic assets amplify this tendency among Chinese firms affiliated to diversified groups. Ordered logit modelling for 662 Chinese cross-border M&As over a 10-year period provides support for our hypotheses. Our findings shed new light on: the distinctive characteristics of Chinese MNEs; broader conceptual arguments regarding the strategy of emerging market MNEs; the apparent paradox of why Chinese MNEs have used international acquisitions to diversify at a time when many Western diversified conglomerates are divesting non-core businesses.

The UN’s Sustainable Development Goals: Can multinational enterprises lead the Decade of Action?

The Sustainable Development Goals (SDGs) were adopted in 2015 by all UN member states and have been embraced by many multinational enterprises (MNEs) and international NGOs. They created a ‘hybrid governance’ platform in which companies, governments, NGOs, and knowledge institutes can work on achieving common goals through targeted action and serve as the leading global sustainable development framework until 2030. By the year 2020, however, progress towards the goals proved slow, prompting the UN to announce a ‘Decade of Action’. The slow or limited adoption and implementation of the SDG Agenda by MNEs – in close interaction with government policies – is one of the root causes for delayed progress. The question is no longer ‘why’ MNEs should develop sustainability strategies, but rather ‘how’. A number of related questions arise. What have been the roles of MNEs in progress towards the SDGs, what is needed from them in the future, and what can be the role of international business (IB) scholarship in shaping discussion and action? This Special Issue tackles these questions from four angles: (1) identifying and helping to fill theoretical gaps in IB research on the SDGs; (2) asking which SDGs and targets provide promising venues for societally relevant IB research topics; (3) assessing and helping to fill empirical gaps by using, complementing, and upgrading relevant SDG indicators; and (4) showing how IB research and policy practice can become better aligned.

The formation of an MNE identity over the course of internationalization

Organizational identity describes how members of an organization think about ‘who we are.’ But how exactly does a multinational enterprise (MNE) form an identity revolving around its key feature – that it is a globally operating organization with subsidiaries across several countries? Tracing the evolution of AutoCorp, a German MNE, over almost 30 years, I develop theory on how an MNE identity is formed over the course of internationalization. Focusing on the relational evolvement of the pair comprising headquarters and the first major foreign subsidiary, my data reveal how the formation process of an MNE identity involves awareness, aspiration, and assimilation as key steps, and sensemaking, storytelling, and standardizing as process mechanisms. I unpack how the process of MNE identity formation unfolds along a set of discrete events, which constitute inflection points marking the transition from one stage to the next: from multiple identities via identity reflection and identity envisioning to an MNE identity. By introducing the notion of an MNE identity, this paper enriches the way international business scholars think about classic questions around the coordination and organization of MNEs.

Business groups and the study of international business: A Coasean synthesis and extension

This paper harmonizes the business group literature in international business and across relevant fields within a unified theoretical framework. Business groups (firms under common control but with different, if overlapping, owners) are economically important in much of the world. Business groups’ economic significance co-evolves with their economies' institutions and market environments, patterns of particular interest to international business scholars. The vast literature on business groups raises discordant perspectives. This paper first proposes a unifying definition and provides a list of stylized historical observations on business groups across different parts of the world. It then develops a Coasean framework to harmonize seemingly disparate views from the literature by building on recent surveys and the stylized historical patterns of business groups. We enlist two concepts – fallacies of composition/decomposition and time inconsistency – to harmonize these perspectives. This yields a theoretical framework for understanding business groups that mobilizes concepts long-used to understand multinational enterprises: the economy's market and hierarchical transaction costs, openness, and their dynamic interactions. We then apply this framework to globalization and business group internationalization. This work leads to an overarching research agenda encompassing seemingly inconsistent prior work.

Research on international business: The new realities

This year (2021) marks the thirtieth year of the establishment of the International Business Review. This anniversary provides an appropriate occasion not only to reflect on past developments in the global economy and International Business (IB) research, but also to offer our thoughts on the new realities that we believe IB scholars should address in the coming years. In this paper, we highlight some of the major changes in the global business environment over the past 30 years. In doing so, we draw attention to four new realities that we believe merit increased attention in the IB literature: the growth of populism and economic nationalism, sustainable development and climate change, new digital technologies, and changing power relationships. These realities are not completely new and IB scholars have already begun to explore their implications, but we would argue that both the scope and the depth of these implications are growing and evolving. We are thus calling for new empirical insights, new theoretical lenses, and new perspectives to shed light on these issues that are increasingly having profound impacts on society, on firm strategies, and on cross-border management.

Back to basics: Behavioral theory and internationalization

International business (IB) scholars’ over-reliance on a select few theories leaves our understanding of firm internationalization incomplete. The behavioral theory of the firm (BTF) can offer new insights and can be used to model a broad range of firm actions. We focus on the three basic BTF components: problemistic search, learning by doing, and vicarious learning. These components help us understand why firm behaviors are more dynamic and heterogeneous than other theories allow. BTF, with its emphasis on how firms assess performance according to aspiration levels, selectively learn and update routines, and selectively incorporate the learning of others, is better suited to examine the diversity and change increasingly observed in internationalization decisions. We explain why scholars should move beyond “dynamizing” static theories and show BTF’s applicability to behaviors involving change such as multi-mode market entries and market re-entries. BTF also helps examine the decision to internationalize in the first place, nascent firm internationalization, location choices, international market adaptation, and headquarter–subsidiary relationships. We encourage IB scholars to use theories that can handle the complexity increasingly associated with modern firm growth, and propose BTF as a promising starting point.