Search results

A somewhat underappreciated aspect of the burgeoning rush to regional trade agreements (RTAs) is a discrepancy between the dispute settlement procedure (DSP) embodied in the original World Trade Organization (WTO) Dispute Settlement Understanding (DSU) and that found in the language of many RTAs. This chapter explores the issue in the context of a dynamic repeated game of trade agreements. As is well known, the institutional alternatives available in negotiating multilateral freer trade agreements – regional agreements, side agreements, trade dispute settlement punishments, and so on – can proscribe the limits and shape the nature of self-enforcing trade agreements. Here, we suggest the extent to which deviations from the WTO DSP embodied in RTAs – for example, “private interest access,” “third party procedures,” and “choice of forum” – can not only work against the interests of “weaker parties” but furthermore undermine multilateral agreements closer to free trade.

This article aims to explore how knowledge-intensive service firms design inter-firm contracts to govern the exchange of highly intangible and inseparable knowledge under varying degrees of property right protection.

This research uses a multiple case study of management consulting firms domiciled in Serbia and Albania.

Firms domiciled in relatively weak property right settings prefer more informal contracts, whereas those in settings of superior property right protection favour greater formality as a means of encouraging the creation and sharing of knowledge, whilst concurrently mitigating the threat of opportunism.

This article contributes new knowledge with regard to the design of inter-firm contracts to govern the sharing of highly intangible and inseparable knowledge. In terms of theory, it employs a transaction cost economics approach in which inter-firm contracts are decomposed into five requisite provisions, which are then related to the degree of formality.

Knowledge-intensive service firm managers should assess the degree of property right protection when considering the degree of formality of inter-firm contracts.

The study constitutes the first attempt to empirically examine how knowledge-intensive service firms craft contracts in different property right settings. With the burgeoning number of cross-border collaborative partnerships between such firms, it offers important insights into the choice of governance mechanism in different property right protection settings.

This study examines the process of establishing a viable brand in a new foreign market through successful market entry governance by utilizing various types of branding alliances to transfer corporate brands. Drawing from corporate illustrations and building upon Ghosh and John's (1999) governance value analysis (GVA) model, a decision model for managers is developed providing theory-based guidance for market entry strategies. Relational governance can be considered as a continuum ranging from strong relational (i.e., joint ventures, co-branding) to weak relational (i.e., joint promotion, marketing alliance) forms. Firms should organize their market entry strategy based upon brand equity resources, specific investments made by the partner, and environmental uncertainty (market volatility and cultural distance), so as to transfer the desired brand image and associations into local markets by maximizing the level of value created and value claimed. This study contributes to the international marketing literature by providing a theoretically strong decision model, supported by corporate examples, of how firms enter markets using various types of brand alliances. It also advances the practice of international marketing in regard to branding by providing insights as to how managers in the global marketplace can effectively transfer brand images and build global brand equity, minimizing firm costs while maximizing the value created and claimed from the brand.

In the context of the negotiations for apportionment of emission reduction post‐Kyoto regime, issues of equity and fairness have emerged. The purpose of this paper is to generate a model for equitable emission reduction apportionment.

The mathematical model has been designed utilizing mitigation capacity (based on gross domestic product (GDP)) and cumulative excess emissions as the criteria for apportionment. Quantitative results have been arrived at, using cumulative γ and parabolic mitigation emission reduction trajectories to demonstrate the impact on stakeholders.

The apportionment outcomes are independent of the specific trajectory fine‐tuned in the feasibility region. Since the apportionment takes into account entitlements and the mitigation capacity, Africa and India have negligible reduction targets in tune with the development goals in these economies. Substantial reduction commitments would fall on the USA and the EU countries. China gets a moderate target due to higher emissions and GDP.

The approach is in consonance with the principle of common but differentiated responsibility enunciated in the UNFCCC and the Kyoto Protocol. The method can easily incorporate emissions trading. The issue of population as a driving factor of emissions has been partially accounted for by considering the entire national GDP as an emission reduction responsibility factor, without considering population based GDP entitlements.

The generalized framework can be extended to situations involving responsibility apportionment in public policies dealing with externalities. The framework is original and will be useful to policymakers and other stakeholders dealing with climate change, as well as researchers looking at externalities of a global or national dimension.

This paper seeks to report the results of a study examining the effects of manufacturer-distributor relationships' governance structures (market governance, third-party enforcement of agreements and self-enforcing governance modes) on the distributor's willingness to collaborate with the manufacturer.

To test the hypotheses, survey data were gathered from 224 wholesalers from the food and beverage industry in Spain. Manufacturer-distributor collaboration refers to the possibility of sharing strategic information and encouraging creativity. Regression analyses illustrate the differences in the distributor's willingness to collaborate with the manufacturer under different governance scenarios.

The study illustrates that the greater the skill of the manufacturers and distributors in developing self-enforcing governance modes (e.g. bilateral formal safeguards and bilateral informal safeguards) that complement third-party enforcement of agreements (e.g. legal contracts), the greater the willingness of both to share strategic information and creativity will be. Furthermore, this investigation delineates the moderating effect of opportunism on the relationship between governance and the distributor's willingness to collaborate with the manufacturer. Finally, the results show that the distributor's willingness to share strategic information has an inverted-U relationship with creativity and innovation development in manufacturer-distributor relationships.

The study's findings allow firms to concentrate their efforts on the most relevant governance structures that minimize transaction costs and provide incentives to develop collaborative manufacturer-distributor relationships and create value for the customer.

The research acknowledges the multidimensional nature of collaboration and goes deeper into the need to share strategic information (external and internal strategic information) and the factors that compose the generation of creative ideas in the manufacturer-distributor relationship (knowledge-sharing routines, learning orientation, open-mindedness and management support). Additionally, although research on collaborative distribution channel practices has advanced over the past decades, the importance of governance structures to the development of collaborative practices has not been firmly established. The paper addresses this void in the literature by reporting the results of an empirical study examining manufacturer-distributor collaborations within the food and beverage industry in Spain.

The global market failure problem of international biodiversity loss can be mitigated through the use of trade interventions or by the creation of new international markets and institutions for the global environmental benefits generated by the biodiversity conserved by host countries. However, it may be difficult to reach a mutually agreed “trade for nature” deal when the biodiversity in the host country is threatened mainly by habitat conversion. On the other hand, if the threat is from over‐exploitation, unilateral trade interventions by the recipient countries are also likely. Although there may be strong incentives for the latter countries to negotiate an international biodiversity agreement, if such incentives exist, then these countries may act unilaterally to compensate host countries for their conservation efforts. Rich countries therefore need convincing that they are likely to gain from reducing global biodiversity loss.

In this paper we analyze the influence of transaction costs on the stock market reaction to global alliance formation. In particular, we analyze to what extent the stock market reacts negatively to the presence of attributes that increase motivation or coordination costs. We adopt a relational framework, analyzing the direct impact of these attributes not only on transaction costs but also on the potential synergies of the alliance and the incentives to invest in the relationship. Our results show that the stock market reacts negatively to transaction costs only in connection with free riding hazards.

This paper seeks to examine the inter‐organisational processes used to control international master franchise agreements from operational, relational and evolutionary perspectives.

The research is undertaken through a qualitative, in‐depth case study in the international hotel industry. The case comprises an international master franchise agreement between a large US‐based hotel franchisor and its European master franchisee.

The study identifies the inter‐related nature of operational and relational control processes and how these evolve over the life of a master franchise agreement. It reveals how the perceptions of franchise members serve to enhance or inhibit the development of relational norms and how these, in turn, impact on the predominant type of control and the specific inter‐organisational processes employed.

The research is based on a single in‐depth case study within one industrial context and the universality of the findings may therefore be limited.

The paper offers insights to managers of international master franchise agreements on the interaction between members' perceptions, relational norms developed and the inter‐organisational processes used to control the agreement. It also reveals how the use of contractual controls can inhibit the development of relational norms and negatively impact on relationships between franchisors and master franchisees. The findings presented may have relevance to managers of other types of international alliance agreements.

By drawing on both the alliance and franchise literature and employing a qualitative approach, the study helps to close a gap in the current international franchise literature through the identification of specific inter‐organisational processes for control within international master franchise agreements, how these evolve in respect of relational norms and how these are underpinned by perceptions of franchisor and franchisee members.

Inter‐firm channel relationships have recently attracted great interest in academic research. This paper attempts to make a study of the governance mechanisms in manufacturer‐distributor relationships and the role played by the relationalism perceived by channel members. In particular, the aim is to account for why exclusive dealing and exclusive territories agreements frequently appear in association. Two theories are compared regarding this question. In one of the theories relationalism plays a mediating role between both vertical restraints, whereas according to the other theory the relation between the two is independent of the degree of relationalism. A sample of 96 Spanish manufacturers was used to test the hypotheses proposed, obtaining empirical support for both theories.

An agency relationship exists whenever one party (the principal) delegates authority to another (the agent). Because agents are assumed to be self-interested and to possess goals that diverge from the principal's goals, the principal must expend resources (called agency costs) to insure that agents act in her interest (Jensen & Meckling, 1976). In chains, the firm can choose as outlet managers either employees who are paid a salary (and perhaps a bonus) or franchisees who are granted the right to their outlet's profits after royalties and other expenses. In both cases, an agency problem is created because the firm delegates local decision-making to outlet managers whose interests are not perfectly aligned with that of the franchisor's (Rubin, 1978).