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Understanding the impact of country effect on financial performance is important for service firms as they continue to grow and operate across national borders. The purpose of this paper is to empirically quantify the impact of country and several country-specific variables on firm performance in the service sector by estimating the portion of variation in firm performance attributed to these factors.

Using hierarchical linear models, the authors estimate the proportion of variation driven by country effects. These estimates are obtained from a data panel of 16,051 units from 3,345 service firms across 32 countries over a seven-year time frame (2001-2007).

In the analysis, home country explains approximately 11 percent of the variance in performance. Additionally, the authors find that six country-specific variables, namely, quality of governance, openness to trade, wealth, growth rate, uncertainty avoidance and individualism collectively explain 10 percent of variation in performance or 26.8 percent relative variation of performance.

This study extends the literature on country effect by quantifying the impact of country-specific dimensions on performance. It focusses on a single industry within the service sector. This allows for a more reliable estimate of the country effect, as it will not be confounded by cross-industry effects – thus alleviating some of the concerns with earlier research. Understanding the impact of the six specific country variables investigated in this work will allow service firms to better predict and improve the performance of subsidiaries.

Location-specific advantages (LSA) and the liability of foreignness (LOF) are key concepts in international business and management research. To combine these concepts in a systematic framework, I develop a two-by-two matrix focusing on the nature of International Business (IB) research using four key terms: firm, context, comparative and interactive. This framework serves as a heuristic device in describing three main challenges IB scholars face when advancing the role of LOF and LSAs. These challenges relate to our understanding of the nature of relative advantage, to the development of a dynamic (so-called non-ergodic) world view and to the inclusion of the relevant spatial heterogeneity.

Purpose – The aim of this chapter is to measure the wage premium associated with various levels of educational attainment using micro-data from the Luxembourg Income Study. The study focuses on working-aged adults in eight developed countries for various years between 1984 and 2005.

Methodology – The chapter computes wage ratios reflecting the premium associated with low, medium, and high levels of educational attainment, which correspond to completion of less than secondary education, secondary education, and tertiary education, or an equivalent level of vocational training. These ratios, along with several other variables, are then related to the 90/10, 75/25, 90/50, and 50/10 wage ratios in a country-level unbalanced pooled cross-sectional time series analysis.

Findings – Returns to education account for an important share of cross-country variation in various modes of wage inequality, although other variables matter as well.

Research limitations – The data needed to compute returns to education data are unavailable for a number of countries and years.

Originality – The chapter offers a more precise measure of the returns to education than earlier cross-national work, which has typically focused on average levels of education and other aggregate measures.

Respondents from fifteen countries reported their level of use and involvement with eight products and services: the countries were Argentina, Austria, Australia, Barbados, Canada, Chile, China, Columbia, England, Finland, France, Mexico, Sweden, the United States and Yugoslavia; the products and services were air travel, beer, blue jeans, eating at a restaurant, hair shampoo, going to the cinema, soft drinks and stereo sets. The results indicated that country accounted for eight to 45 per cent of the variation in product and service usage. Among regular product users, country accounts for one to 20 per cent of the variation in involvement levels across products and services.

Many public-sector building projects in developing countries are prone to variations owing to the changes made to their original project scopes, and economic depressions and stagnations. Cost and time-overruns are consequences of such variations. Thus, variation management in these projects is important. Hence, this paper aims to analyse the methods of managing variations in public-sector building projects in Sri Lanka.

The study adopted a mixed research approach. Seventeen expert interviews and a questionnaire survey were conducted to identify the causes and consequences of the variations, and the strategies that will help manage those variations. Manual content analysis and mean weighted rankings (MWR) were used to analyse the collected quantitative and qualitative data, respectively.

The employer, consultant, contractor and several other factors are mostly responsible for the variations in public-sector building projects in Sri Lanka. Cost and time-overruns, rework and demolition and disputes are the major consequences of such variations. The study findings reveal that a detailed employer’s brief, clearly defined project objectives, a comprehensive design and set of specifications, and preliminary investigations are the strategies that will mostly minimise the variations in public-sector building projects in Sri Lanka.

The study proposes strategies to avoid or minimise the adverse impact of variations, which the industry practitioners can adopt for variation management in public-sector building projects. The study theoretically contributes to knowledge by revealing how variations in public-sector building projects in Sri Lanka can be managed by identifying their causes and consequences.

To transcend the view of employment as either formal or informal, this paper evaluates the prevalence of quasi-formal employment where formal employers pay formal employees an unreported (“envelope”) wage in addition to their formal reported salary. To explain the individual-level variations in quasi-formal employment, the “marginalisation” thesis is evaluated that this practice is more prevalent among vulnerable groups and to explain the country-level variations, and a neo-institutionalist theory is evaluated that it is more prevalent where formal institutional failures lead to an asymmetry between the formal laws and regulations and the unwritten socially shared rules of informal institutions.

To evaluate the individual- and country-level variations in the prevalence of quasi-formal employment, a multi-level logistic regression is provided of data from special 2019 Eurobarometer survey 92.1 involving 11,793 interviews with employees across 28 European countries (the 27 member states of the European Union and the United Kingdom).

Of the 3.5% of employees (1 in 28) who receive under-reported salaries, the marginalisation thesis is supported that it is largely vulnerable population groups. So too is the neo-institutionalist explanation that quasi-formal employment is more common in countries where the non-alignment of formal and informal institutions is greater, with the formal institutional failings producing this identified as lower levels of economic development, less modernised state bureaucracies and lower levels of taxation and social protection.

The policy implication is that tackling quasi-formal employment requires not only enforcement authorities to improve the risk of detection of this illegal wage practice but also governments to change wider macro-level structural conditions. These are outlined.

Contemporary new evidence is provided of the prevalence of quasi-formal employment along with how this illegal wage practice can be explained and tackled.

Earlier Nordic comparative studies show variation between countries in child welfare practice, reflecting cultural differences, and that case workers share the norms, values and attitudes of their society. Can cultural factors be concretised for discussion? Child welfare workers in Denmark, Iceland and Norway were presented with five child care stories (vignettes) that focused on the ‘threshold’ between preventive measures and out‐of‐home care (consensual or compulsory). Vignette themes included parental neglect, maternal alcohol misuse and youth problems. Study participants gave written answers to the vignettes and took part in group discussions with colleagues. The results showed significant differences between countries in case workers' responses. Variations in arguments, decisions, use of compulsion and working style reflected national views and priorities. A central dimension was how case workers balanced parental interests with children's needs: in Denmark they were reluctant to intervene with parental rights, whereas the Norwegians were more accepting of compulsory decisions to protect children.

Purpose – This chapter examines how gender, parenthood, and partner's employment are related to individual's employment patterns, analyzing paid work at individual and household levels.

Methodology/approach – Analyses use individual-level data from the Luxembourg Income Study (LIS) wave 5 for 19 countries, for adults aged 25–45. We use logistic regression and a two-stage Heckman sample selection correction procedure to estimate the effects of gender and parenthood on the probabilities of employment and full-time employment.

Findings – The variation between mothers and childless women is larger than that between childless men and childless women; differences in women's employment patterns are driven by gendered parenthood, controlling for women's human capital, partnered status and household income. Fathers and mothers' employment hours in the same household vary cross-nationally.

Mothers' employment behaviors can identify important differences in the strategies countries have pursued to balance work and family life.

Research implications – Important differences between childless women and mothers exist; employment analyses need to recognize the variation in employment hours among women, and how women's hours are related to partners' hours. Further research should consider factors that shape employment cross-nationally, as well as how these relate to differences in wages and occupational gender segregation.

Practical implications – Employment choices of women and mothers must be understood in terms of employment hours, not simply employment, and within the context of partners' employment.

Originality/value of paper – Our chapter clarifies the wide dispersion of employment hours across countries – and how men's and women's employment hours are linked and related to parenthood.

This paper evaluates the economic, political and institutional determinants of variation in public investment in emerging Europe.

Panel econometrics (panel-corrected standard error, generalized least squares and the two-stage least squares) methods have been applied using annual data from 2000 to 2017 for 16 countries from Central and Eastern Europe (CEE).

Public investment was procyclical in relation to output and negatively associated with the level of public debt. Austerity episodes triggered a significant drop in public investment. Positive drifts in public investment during election periods and the negative impact of the number of cabinet seats held by left-wing parties have been captured. While no firm evidence on the impact of EU membership was found, the results show that arrangements with the IMF were strongly associated with lower public investment. Political factors were of greater importance in Central Europe and the Baltics, while institutional factors had a more significant impact in South Eastern Europe.

To foster public capital formation, it is necessary to: 1) strengthen the countercyclicality of public investment policy and to keep public debt at a low level; 2) adjust the fiscal criteria for EU membership in a manner that would enable countries to use the EU structural fund more effectively, while maintaining fiscal sustainability; 3) put a stronger emphasis on structural features of fiscal policy when designing country-level arrangements with the IMF.

The paper contributes to the literature on determinants of public investment policy by adding empirical evidence for emerging Europe countries.

The purpose of this paper is to investigate inflation convergence within the East African Community (EAC) as it aspires to become a currency union.

An unobserved dynamic factor model was used to decompose the variation in inflation into a component that is common across the countries in the EAC region and a component that is country specific. Convergence was measured by the percentage of variation in inflation that is common across countries.

The estimated results from the dynamic factor model for the pre‐EAC Treaty (1981:3 to 2000:2) period and post‐EAC Treaty (2000:3 to 2009:1) period suggest that the percentage variation in inflation in the EAC that is explained by the common regional component increased significantly during the post‐Treaty period.

One of the limitations of this paper is that it does not address the mechanism through which the convergence in a currency union is achieved. Future research should try to examine the link between convergence and different macroeconomic policies.

This paper suggests that the push towards forming a currency union in East Africa has led to a greater degree of inflation synchronization across different countries in the region.

The main contribution of this paper is to use an unobserved component model to estimate the degree of inflation synchronization in East African countries.