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The costs of doing business abroad (CDBA) is a well-known concept in the international business literature, measuring the disadvantages or additional costs borne by multinational enterprises (MNEs) that are not borne by local firms in a host country. Recently, international management scholars have introduced a second concept, liability of foreignness (LOF). There is confusion in the two literatures as to the relationship between CBDA and LOF, as evidenced in a recent special issue on liability of foreignness (Journal of International Management, 2002). We argue that LOF stresses the social costs of doing business abroad, whereas CDBA includes both economic and social costs. The social costs arise from the unfamiliarity, relational, and discriminatory hazards that foreign firms face over and above those faced by local firms in the host country. Because the economic costs are well understood and can be anticipated, LOF becomes the core strategic issue for MNE managers. We argue that the key driver behind LOF is the institutional distance (cognitive, normative, and regulatory) between the home and host countries, and explore the ways in which institutional distance can affect LOF. We operationalize our arguments by showing how institutional distance and liability of foreignness can provide an alternative explanation for the MNE’s ownership strategy when going abroad.

I build on a strong foundation of prior studies about expatriate compensation in general to provide an overview of changes in expatriate compensation, from home- to host-based approaches, during the past 10 years.

Underpinned by findings from academic and practitioner literature, I review and integrate studies of expatriate compensation and global talent management to outline the challenges and opportunities home- and host-based compensation approaches present to MNEs.

Home-based compensation is becoming an outdated and overly expensive model that is often ineffective in moving MNEs’ global competitive advantage to where it needs to be, leaving host-based approaches as the only alternative. But the use of host-based “cheaper” compensation approaches can also lead to unintended outcomes for MNEs in terms of unforeseen opportunity costs (such as the loss of critical talent) arising from shortsighted compensation decisions.

I argue that expatriate compensation works best when it is not based on an employees’ home-country status but instead on the role that he or she performs locally. I suggest a host-based compensation approach — global compensation — that is based on the worth of the position rather than where the individual has come from. Such an approach is more equitable because it is performance-based thereby eliminating overpaying and perceived unfairness. It is much simpler to administer than home-based compensation because it represents an extension of most MNEs already existing domestic (home country) pay-for-performance model.

Despite more than 10 years of new compensation practices being implemented and reported by global mobility practitioners, very little has been studied or written by scholars about some of the recent changes in expatriate compensation over the past decade. The chapter addresses this gap in academic literature.

This chapter discusses how firms can accrue unique advantages from their foreign status in the host country, with a particular focus on informal networks. Drawing on the literature on the liability and asset of foreignness, this chapter argues that foreign firms can be in a better position to balance between the bright and dark side of informal networks than local firms. Foreign firms can deviate from local isomorphic pressures to minimize potential involvement in negative sides. Moreover, they can build more instrumental informal networks in which the dark side of informal networking is better controlled and regulated without losing social cohesion, flexibility, and other benefits of the bright side. This chapter contributes to our understanding of how foreign firms can turn foreignness into assets from liabilities when managing their informal networks in the host country.

International students face challenges when they attend a university outside their home country. Some of those challenges can be language barriers, expectations of professors, university rules and living situation. All of these can add strain to an already stressful situation of studying abroad. Student integration into a local society can offset some of the anxiety of studying overseas (Mattis, 2019). Students who have made friends are comfortable living within the locale in which they are studying and have reported more satisfaction than those students who have not integrated into a local society (Fischer, 2012). This chapter will study the ways in which students should work to integrate themselves into the local society and how the university and professors can help international students find a way to become familiar and content within the local society. Learning the regional language, culture and social activities help enhance the student’s satisfaction.

This study focuses on the impact of foreign direct investment (FDI) on local firms in host economies. We examine both backward and forward linkages and their effects on domestic firms. Data collection was undertaken over a three-year period whereby qualitative in-depth interviews were carried out with senior managers in UK headquarters, subsidiaries and ‘linked’ local firms in order to facilitate a multi-perspective approach to examining this topic. Results indicate that linkages do exist, contrary to earlier belief. The main factors which facilitate linkage formation were found to be subsidiary-related variables, mainly the mode of entry into the local market, subsidiary autonomy, level of embeddedness and subsidiary role. It was also found that government regulation and policy had some impact on the formation of linkages. Over time the impact on local firms was found to be positive with increased employment, productivity and significant upgrading of skills and competencies. The key contribution of this chapter is to extend the literature on linkages to consider services while developing a conceptual framework in this area. Overall, our study confirms the importance of the subsidiary in linkage formation and also shows how the externalities occurring from linkage formation in the service sector may benefit local firms and subsequently aid local economic development as a whole.

This study examines how foreign R&D investment may explain interfirm variations in productivity performance of home country firms in terms of spillovers. Many have studied spillovers from MNCs to host country’s firms, but there is still scarce evidence on spillovers from outward FDI to the home country. This study analyzes spillovers from foreign R&D investment and hypothesizes that the benefit of outward R&D spillovers occurs only when knowledge accumulated in foreign R&D centers is effectively transferred to MNCs’ parent companies at home. This benefit depends on the mandate of foreign R&D units, their embeddedness in the host economy, and their entry mode. Using detailed firm-level data for Switzerland, our findings seem to support our arguments.

Prior research documents that host communities struggle to influence tourism product design and destination management; however, emerging information and communication technologies (ICTs) are allowing host communities to bypass retail monopolies and create self-representation. This chapter examines how to make technological innovation endogenous to a regional growth model by identifying barriers constraining the adoption of innovation among rural microentrepreneurs in Pennsylvania. Insights about adoption of ICTs were gathered through participatory action engagement and semi-structured interviews with a network of rural tourism microentrepreneurs. Analysis revealed that microentrepreneurs perceive that tracking and monitoring customer inquiries is very time consuming, and they feel that using these platforms diverts them from achieving their desired lifestyles.

Pervasive forms of worldwide communication now connect us instantly and constantly, and yet we all too often fail to understand each other. Rather than benefiting from our globally interconnected reality, the world continues to fall back on divisiveness, a widening schism exacerbated by some of the most pronounced divisions in history along lines of wealth, culture, religion, ideology, class, gender, and race. Cross-cultural dynamics are rife within multinational organizations and among people who regularly work with people from other cultures. This chapter reviews what we know from our scholarship on cross-cultural interaction among expatriates, negotiators, and teams that work in international contexts. Perhaps more important, this chapter outlines what we need to learn – and to unlearn – to be able to see diversity as an asset in helping individuals, organizations, and society to succeed rather than continuing to understand it primarily as a source of problems.

Considering the economic potential of festivals to Creative Tourism, this chapter discusses the potential of the small-scale ones for rural development. It reviews worldwide small-scale festivals and engages them with creative activities, presenting the results of some of the small-scale festivals that occur in Southern Europe. It explores the impacts of a small-scale festival on the development of a medium-sized city or a rural area and the challenges they must face in the future. Furthermore, it deals with what kind of new offer can be developed in order to make these territories more sustainable. In this context, Southern Europe plays an important role due to its rich historical heritage that can diversify the offer and the type of experience, being an excellent opportunity to promote the preservation of those at risk of disappearing. This chapter uses primary and secondary data. A geodatabase was created to understand South European festivals on Creative Tourism. Examples from Italy, Greece, Slovenia and Portugal were analysed.

This case examines the concept and role of adaptability in destination governance, particularly as it relates to hosting a mega-event such as the 2010 Olympic and Paralympic Winter Games. It describes how the Resort Municipality of Whistler in British Columbia, Canada, used its broad sustainability-focused destination governance system to guide and manage relationships and outcomes related to the Games. Through its strategic and adaptive interactions with the International Olympic Committee and the Vancouver Organizing Committee, the Resort Municipality of Whistler leveraged unprecedented sustainability benefits from this mega-event.