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Article
Publication date: 14 September 2020

Cláudia Beatriz Batschauer da Cruz, Dinorá Eliete Floriani and Mohamed Amal

This study aims to advance a sub-national perspective within the OLI Paradigm by analyzing how and to what extent the Eclectic Paradigm can serve as a general model to capture…

3027

Abstract

Purpose

This study aims to advance a sub-national perspective within the OLI Paradigm by analyzing how and to what extent the Eclectic Paradigm can serve as a general model to capture region-specific aspects of the location determinants of FDI, encompassing institutional effects that extend beyond the quality of institutions.

Design/methodology/approach

The authors conducted a systematic literature review of 41 selected papers published between 1990 and 2019. Using inductive content analysis, they investigated the theoretical choices used to support analyses of the effects of institutional factors on MNEs' location decisions at the sub-national level.

Findings

It was found that, when changing from the national to the sub-national level of analysis, there is no need to change the main assumptions used in the literature, although a different perspective must be adopted. The Eclectic Paradigm permeates most of the studies revised and can serve as a general model to capture the sub-national perspective. It offers a foundation for new perspectives on the dynamics of institutional and political factors and their effects on location strategies and determinants at the sub-national level. Adopting the OLI Paradigm with a sub-national approach could widen the IB literature's prevailing focus on traditional economic factors and institutional quality.

Research limitations/implications

The authors contribute to extant International Business literature Their paper enhances the literature on FDI location determinants by providing a more specific approach to development of a sub-national perspective within the OLI Paradigm, extending the institutional effects to capture more region-specific factors influencing the location of FDI. Study limitations are related to our analytical focus on the location dimension, excluding motives for FDI or firm-level location strategies. Rather than limiting analysis to quantitative studies, future research that includes qualitative studies and also covers the other dimensions of the OLI Paradigm could open additional new research avenues for advancing the sub-national perspective within the field of IB.

Practical implications

The authors’ main findings suggest that MNEs' location strategies should include a sub-national perspective, which means that firms need to assess different levels of the location and understand their interaction with nationwide constraints and limitations, as it may affect firms' ability to effectively conduct their value-adding activities. They also contribute elements that can support sub-national governments' actions and policies aiming to enhance locational advantages to attract and retain FDI.

Originality/value

This review specifically analyzes the location determinants of FDI at the sub-national level, in studies published in a broad set of journals, from a variety of fields, prioritizing articles that investigate sub-national institutional determinants. The authors derive implications for the International Business literature and propose that the sub-national dimension should be incorporated into the Eclectic paradigm in order to better understand the influence of institutional sub-national determinants.

Details

International Journal of Emerging Markets, vol. 17 no. 1
Type: Research Article
ISSN: 1746-8809

Keywords

Article
Publication date: 23 May 2019

Khee Giap Tan, Sasidaran Gopalan and Jigyasa Sharma

The purpose of this paper is to examine the impact of real effective exchange rates (REER), both in terms of levels and volatility, on the export performance of India’s sub

Abstract

Purpose

The purpose of this paper is to examine the impact of real effective exchange rates (REER), both in terms of levels and volatility, on the export performance of India’s sub-national economies, given the recent slowdown in India’s exports.

Design/methodology/approach

India’s export distribution is highly asymmetric, with 90 percent of India’s exports concentrated in 11 sub-national economies. Exploiting this concentration, this paper constructs a panel data set using available data between 2002 and 2014 to understand the relationship between REER and exports from the top exporting cluster. Moreover, the paper constructs a sub-national competitiveness index to capture the supply capacity of the states.

Findings

The empirical findings of this paper reveal that a higher REER volatility deters exports and movements in REER do not matter as much as volatility. The most significant finding of the paper is that state competitiveness is the most crucial factor affecting trade. Therefore, policy makers at the state level must lay more emphasis on the supply side such as addressing logistical bottlenecks to help revive exports growth.

Originality/value

This study makes a departure from the plethora of extant aggregate-level studies by examining the relationship between REER and exports at the sub-national level for India. Considering the highly skewed distribution of India’s exports, the study provides important insights into the exporting patterns and determinants that are at play at the sub-national level.

Details

South Asian Journal of Business Studies, vol. 8 no. 2
Type: Research Article
ISSN: 2398-628X

Keywords

Article
Publication date: 3 October 2018

Khee Giap Tan, Sasidaran Gopalan and Will Nguyen

The purpose of this paper is to contribute to the literature by introducing a novel index that measures ease of doing business (EDB) at the sub-national level. The authors provide…

Abstract

Purpose

The purpose of this paper is to contribute to the literature by introducing a novel index that measures ease of doing business (EDB) at the sub-national level. The authors provide a comprehensive assessment of both de jure and de facto business conditions in 21 sub-national economies of India, with the help of a holistic framework that encompasses indicators capturing Attractiveness to Investors, Business Friendliness and Competitive Policies (ABC), the three broad environments that constitute the EDB–ABC index.

Design/methodology/approach

The authors’ index EDB–ABC index is constructed using 81 indicators. The index values reported are standardized scores and the framework is applied to 21 Indian sub-national economies. The bottom-up approach takes into account the various operational issues that firms face at the ground level, with the emphasis being on de facto issues. A unique feature of the index is its emphasis on collecting extensive survey data at the sub-national level, given that several constraints that businesses face lie under the purview of the sub-national governments. It also combines publicly available macroeconomic data through formal statistical publications.

Findings

The findings suggest a positive association between the proposed EDB–ABC index and competitiveness of as well as investments into Indian sub-national economies. In terms of explanatory power, the authors find that indicators capturing attractiveness to investors and business friendliness which are representative of de facto implementation issues at the sub-national matter more than de jure competitive policies. It is also striking that the results are in stark contrast to the existing doing business studies highlighting the importance of the comprehensiveness of the index.

Originality/value

Easing the impediments to doing business is a pre-requisite to enhance both domestic as well as foreign investments. Existing indicators on doing business provide an incomplete picture about the prevailing business conditions as the basis for such rankings are de jure regulations and not de facto. The authors depart from this tradition by dealing with both de jure and de facto business conditions using a combination of primary and secondary data at the sub-national level in India.

Details

South Asian Journal of Business Studies, vol. 7 no. 3
Type: Research Article
ISSN: 2398-628X

Keywords

Article
Publication date: 9 January 2019

Khee Giap Tan, Nguyen Trieu Duong Luu and Sangiita Yoong Wei Cher

The paper offers the first systematic and comprehensive analysis of dynamics of economic growth slowdown for India at the sub-national level covering the period 1993–2013. In…

Abstract

Purpose

The paper offers the first systematic and comprehensive analysis of dynamics of economic growth slowdown for India at the sub-national level covering the period 1993–2013. In light of India’s regional diversity and variation in terms of gross regional domestic product (GRDP) per capita, the purpose of this paper is to empirically investigate the growth dynamics at the sub-national level. The paper aims to answer two questions: first, are determinants of economic slowdown likely to differ across income groups? Second, what are the probabilities that the sub-national economies in India will experience a growth slowdown in the near future?

Design/methodology/approach

The paper undertakes a comprehensive analysis of growth slowdown for 106 Asian developing economies encompassing the national economies in ASEAN and the sub-national economies in Greater China, Indonesia and India. To be sure, the authors are not making any direct comparison to countries at different stages of economic development; rather, the comparison is between economies/sub-national economies that fall in the same income category. The authors construct income group-specific logistic model to identify the relevant determinants of growth slowdown and use Bayesian model averaging techniques as a robustness check. The authors also compute economy-specific predictive probabilities of growth slowdown over the period 2012–2017.

Findings

The empirical results show that a growth slowdown in various income groups tends to be associated with different sets of determinants, although broadly, across all income groups, the occurrence of growth slowdown is positively associated with higher GRDP per capita. The average predictive probability of growth slowdown for India’s sub-national economies is 0.43, indicating that, on average, India’s sub-national economies have a 43 per cent chance of experiencing growth slowdown in the 2012–2017 period. Overall, the prospects of the sub-national economies of India are less worrying than that of Greater Chinese economies but bleaker than the outlook for economies in ASEAN and Indonesia.

Originality/value

The research contributes to the understandings of growth dynamics, especially the issue of growth slowdown, in India. This paper differs from the existing literature on growth dynamics by being India centric and analysing the issue of growth slowdown at the sub-national level. Despite a steady increase in the level of GRDP per capita for the sub-national economies of India since 1993, significant disparities still exist across economies. Identifying determinants of growth slowdown and subsequently computing predictive probabilities serves as early warning signs for policy-makers and generates insights on how development policy can be shaped.

Details

International Journal of Social Economics, vol. 46 no. 3
Type: Research Article
ISSN: 0306-8293

Keywords

Article
Publication date: 4 December 2019

Sheng Huang, Guangyu Ye and Suqin Shen

In the literature concerning international new ventures (INVs), there has been a tension between the learning advantages of newness and absorptive capacity perspectives for…

Abstract

Purpose

In the literature concerning international new ventures (INVs), there has been a tension between the learning advantages of newness and absorptive capacity perspectives for explaining the performance influence of initial entry speed. To address this tension, this paper, through integrating both the motivation and ability to acquire foreign knowledge, proposes a theoretical model about the nonlinear relationship between INVs’ initial entry speed and international performance. Drawing upon upper echelons theory and the institution-based view, this study aims to extend the literature by developing two boundary conditions for this relationship: the moderating role of executives’ individual learning orientation and sub-national institutions.

Design/methodology/approach

The authors used the latent moderated structural equations approach specific to Mplus to test the hypotheses with data on 322 Chinese INVs.

Findings

The findings indicate that INVs’ international performance will increase initially and then decrease, as they accelerate initial entry speed (an inverted U-shaped relationship), and that INVs managed by executives with a higher learning orientation and located in better sub-national institutional environments achieve greater international growth gains from moderate initial entry speed.

Originality/value

This study mainly makes contributions to the INV literature by integrating the motivation and ability to acquire foreign knowledge to offer full understanding of the effect of initial entry speed on international performance, and by elaborating on the moderating effects of executives’ individual learning orientation and sub-national institutions on this relationship.

Details

Chinese Management Studies, vol. 14 no. 1
Type: Research Article
ISSN: 1750-614X

Keywords

Article
Publication date: 17 March 2023

Vandana Goswami

The present paper makes an attempt to investigate the determinants that affect FDI inflows distribution among Indian states. Together with traditional determinants, the impact of…

Abstract

Purpose

The present paper makes an attempt to investigate the determinants that affect FDI inflows distribution among Indian states. Together with traditional determinants, the impact of institutional determinants on state-level FDI inflows distribution in India has been analysed.

Design/methodology/approach

The study uses panel data for a period of 20 years (2000–2019) for 17 groups of Indian states (29 states and 7 UTs). The empirical evidence is based on the panel data method and the findings support Dunning's OLI theory. As the data for some indicators for the institutional environment is not available at the state level, hence we used component analysis to arrive at the single component for the institutional factor. The study takes into account corruption, legal system, industrial disputes, man-days lost, labour availability, political risk, protection of IPR and agglomeration as potential macroeconomic and institutional determinants.

Findings

Results show that FDI inflows into Indian states is driven mainly by institutional environment. From our analysis, the author infers that the institutional variables such as legal system, IPR, corruption, political instability play an important role in determining the distribution of FDI inflows at the state level in India. Together with that GFCF and agglomeration are also important determinants of state-wise FDI inflows.

Research limitations/implications

The major limitation of the study is that it doesn't include moderated impact of economic and institutional determinants of FDI inflows in Indian states, which can be an avenue for future research. Future research can also carried out taking district-level data to further examine the determinants at district level in India.

Originality/value

The contribution of the present paper is three-fold, first, the author constructs a measure of different institutional variables, after normalization of data for the period 2000–2019, and the author choose the highest explaining factor with the highest variance explained then we constructed the indices for select variable, which further has been used in the panel data analysis technique. The author has found that macroeconomic variables, as well as institutional variables, are significant to attract FDI at the state level in India. The paper shows that corruption, political risk, IPR and legal system are the major institutional determinants of FDI inflows in India at the state level. States with higher domestic investment attract more FDI inflows, moreover, agglomeration is a very important determinant as the investors are more confident in investing at the same location, the reason behind this may be that the investors want to avoid the registration procedure for new land, administrative formalities or they feel more secure at the same place and keen to invest at the same place again.

Details

International Journal of Emerging Markets, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1746-8809

Keywords

Open Access
Article
Publication date: 7 November 2018

Ayman El-Dessouki

This paper aims to examine the effects of domestic structure forces on “sub-national” foreign policy (SFP); an analytical concept provides a suitable operational framework for…

3183

Abstract

Purpose

This paper aims to examine the effects of domestic structure forces on “sub-national” foreign policy (SFP); an analytical concept provides a suitable operational framework for research on international activities of sub-national entities or regions.

Design/methodology/approach

The paper is carried out on the basis of a theoretical framework proposed by the author. First, the dependent variable is defined. Then, domestic structure is broken down into four variables, including legal grounds, the level of autonomy, the type of intergovernmental relations and institutionalization. A comparative method is used to examine the validity of the theoretical framework.

Findings

The paper finds out that domestic structural forces influence level and form of SFP with some regularity. The influence of these forces on SFP can be explained, as they recur and have such consistent effects that they create patterns and regularities in SFP. Such regularities can be detected through systematic analysis.

Originality/value

The topic of SFP is relatively controversial because of academic debate over international agency of substate actors. However, it is a worthwhile subject of research, as it has the potential to revolutionize research in foreign policy analysis. Moreover, the phenomenon of SFP is in need of theorizing and comparison as the literature on SFP is still in its infancy.

Details

Review of Economics and Political Science, vol. 3 no. 3/4
Type: Research Article
ISSN: 2631-3561

Keywords

Article
Publication date: 1 February 1980

W.N. Barnes

Action in international marketing is usually preceded by research. Most international marketing research reports are built on a skeleton of currently available international…

Abstract

Action in international marketing is usually preceded by research. Most international marketing research reports are built on a skeleton of currently available international socio‐economic, demographic and social indicators. The author in this paper argues that the currently available indicators used by marketing analysts have in many cases little comparative value and are in many cases inadequate for, or irrelevant to, the requirements of marketing. He uses in illustration the needs of a specific project that had as its objective the prediction of the different levels of retail distribution in Western Europe. The limitations of available international indicators are analysed. Preferable alternatives are proposed. Some of these require original research: others the restructuring of existing data. It is also urged that it is a basic pre‐requisite that international marketing analysis be made at the level of the subnational region — not at national level. The formation of a specifically‐oriented Marketing Indicators Working Party is proposed.

Details

European Journal of Marketing, vol. 14 no. 2
Type: Research Article
ISSN: 0309-0566

Keywords

Article
Publication date: 18 May 2022

Adam Salifu and Kennedy Makafui Kufoalor

Although the last two decades have witnessed the implementation of several poverty reduction strategies in developing countries, many have failed to achieve their goal partly…

Abstract

Purpose

Although the last two decades have witnessed the implementation of several poverty reduction strategies in developing countries, many have failed to achieve their goal partly because of defective implementation strategies. This paper examines the implementation of one of Ghana’s flagship poverty reduction programs, the Livelihood Empowerment Against Poverty (LEAP), with a focus on how leadership at the sub-national level influences the implementation of the program.

Design/methodology/approach

Using qualitative research approach, the study selected research participants from two Municipal Assemblies in the Greater Accra Region of Ghana. Using a combination of Focus Group Discussions, Key Informant Interviews and Participant Observation, data were collected from a total of 44 respondents including beneficiaries, officials from the local government (district) and community level actors.

Findings

The paper shows that leaders at the sub-national level were more reactionary than proactive, thereby playing passive roles in the implementation of the LEAP program. It shows that the interaction between LEAP beneficiaries and district officials is rather low, which among others limits the effective utilization of the cash grant by the beneficiaries. It maintains that, for the LEAP program to achieve its overall goal of reducing poverty, leaders at the sub-national level ought to deploy more transformational leadership tendencies to incite beneficiaries to leap out of poverty through skill and human capital development.

Originality/value

The empirical literature is largely silent on the role of leadership in the implementation of cash transfer programs, such as Ghana’s LEAP program at the sub-national level. This study therefore explains the extent to which district level leaders contribute to the effective utilization of cash transfer grants and the human capital development of LEAP beneficiaries in Ghana.

Details

International Journal of Social Economics, vol. 49 no. 11
Type: Research Article
ISSN: 0306-8293

Keywords

Article
Publication date: 6 September 2013

Brendan McSweeney

To comment on Brewer and Venaik's review of the misapplication of the national culture dimensions of Hofstede and GLOBE at the individual and other subnational levels. This paper…

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Abstract

Purpose

To comment on Brewer and Venaik's review of the misapplication of the national culture dimensions of Hofstede and GLOBE at the individual and other subnational levels. This paper supports and extends their critique.

Design/methodology/approach

The implausibility of deterministic claims about the multi‐level power of national culture is described and discussed by drawing on a wide range of disciplines (including anthropology, geography, sociology, and historiography).

Findings

Descriptions of the characteristics and origins of subnational level behaviour based on a priori depictions of national culture values are invalid and misleading.

Practical implications

There are important implications for practitioners. The paper highlights the unsoundness of descriptions of the subnational (individuals, consumer segments, organizations, and so forth) which are derived from nationallevel depictions of culture and the dangers of ignoring the independent causal influence of non‐national culture and non‐cultural factors.

Originality/value

The ecological fallacy in the national culture literature is located within a wider and long‐standing critique of that fallacy. The paper is the first to show that the fallacy in the national culture literature is often an extreme causal version. It not merely supposes cross‐level equivalence, as in the standard version, but more aggressively, it attributes deterministic power to national culture thus excluding other independent influences and agency.

Details

International Marketing Review, vol. 30 no. 5
Type: Research Article
ISSN: 0265-1335

Keywords

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