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Many multinational firms attempt to cope with trade policy uncertainties by developing the option of manufacturing their goods in multiple production facilities in different countries. In this chapter, we explore how such “production switching” options affect the vulnerability of a country’s exports to foreign protectionism. We present a theoretical model of such behavior and show that production switching increases the elasticity of a country’s export with respect to tariffs. The magnitude of the elasticity depends on a country’s position in the value chain. We use the model’s predictions to provide new insights into the vulnerability of China’s exports during the current Sino–US trade war.

In the context of China’s efforts to build world-class enterprises through mixed-ownership reform, this study aims to build an agency theory framework to analyze the differential relation between ownership structure and firm performance in majority versus minority state-owned enterprises (SOEs). It also evaluates the differential influence that political connectedness has on firm performance in the two types of SOEs.

Using a panel data set of Chinese state-controlled mixed-ownership enterprises covering the period 2010–2019, this paper uses ordinary least squares, random-effects, fixed-effects and three stage least squares regression analysis to study the differential impact of ownership structure and political connectedness on firm performance in majority versus minority SOEs.

In minority SOEs, firm performance is positively related to the ownership share of the largest private shareholder and state ownership positively moderates this relation. Furthermore, minority SOEs with a politically connected chairman perform worse than those with a politically connected chairman. In majority SOEs, there is no relation between the ownership share of the largest private shareholder and firm performance. In addition, majority SOEs with a politically connected chairman perform similar to those without a politically connected chairman.

The theoretical framework demonstrates that agency problems are substantially different in minority versus majority SOEs and that this influences how changes in ownership structure and in the type of chairman that is assigned affect firm performance. The empirical analysis confirms these predictions.

Cultural and creative industries (CCIs) have been argued to play an important role in achieving the sustainable development goals (SDGs). However, the mechanisms through which CCIs contribute to the attainment of SDGs remain underexplored. In this study, the authors adopt a network perspective to examine how the structure of a local CCI network relates to its local sustainability performance. By examining a database of 210,182 networked firms out of 1.34 million CCI firms across 294 cities in China, the authors conclude that both the scale and the density of a local CCI network improve the city’s performance in terms of attaining SDGs 8–12. The authors discuss the implications of these findings and propose future research avenues in international business.

This paper aims to examine the impact of oil prices on trade's sensitivity to distance. Furthermore, it seeks to investigate if the nature of trade and the type of goods have a mediating role on the oil prices' impact on trade.

A set of gravity models are estimated on a unique panel dataset from China Customs Statistics that reports trade by customs regime (processing trade vs non‐processing trade) and by transportation mode (air vs sea) for the years 1988‐2008.

Higher oil prices increase the sensitivity of China's exports to distance. This effect is especially pronounced for processing exports, where goods cross borders multiple times. On the other hand, it is smaller for exports shipped by air. While these results are statistically significant, their economic effects are relatively small. This paper estimates that the quadrupling of oil prices between 2002 and 2008 has increased the elasticity of Chinese exports with respect to distance by a mere 5‐7 per cent.

The surge of oil prices in recent years has led to speculation that rising transportation costs could end the period of dramatic world trade growth – in the words of Rubin, “[…] Your world is going to get a whole lot smaller.” This paper suggests that this concern is overstated.

This is the first paper that estimates the mediating role that the nature of trade and the type of goods play on trade's sensitivity to distance.

Carbon leakage – where multinational enterprises (MNEs) transfer carbon-intensive production activities to countries with laxer emissions constraints for cost purposes – is one of the main mechanisms through which international business (IB) contributes to climate change. This chapter discusses a new policy initiative called the Carbon Border Adjustment Mechanism (CBAM) that the European Union (EU) introduced in May 2023 to fight carbon leakage. The authors analyze the logic of CBAM and discuss how it will likely influence IB both in industries that are directly targeted by CBAM and related industries that will face spillover effects.

A cascade of crises that materialized in particular over the 2019–2022 period, increases the relevance for international business (IB) scholarship to address the following question: whether, to what extent and under what circumstances can multinational enterprises (MNEs) rescue the sustainable development goals (SDGs) and make sure that nobody is left behind in a globalized world where the opposite seems to be the case? For many MNEs, slow progress in implementing the SDGs in a more strategic and transformational manner does not necessarily hint at a lack of interest with management, but also at a lack of solid knowledge and/or experience in how to implement general development ambitions like the SDGs. This introductory chapter defines the intellectual and managerial challenges ahead. It refers to relevant efforts already done in the IB community – with reference to IB journals that issued special editions on the topic – and explains why five angles have been chosen to cluster the contributions in this volume which are also aimed to enhance further progress in the study of MNEs and the SDGs: (1) general, (2) strategic, (3) operational, (4) contextual and (5) misbehavior.