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The purpose of this paper is to identify the factors influencing the choice of entry mode of computer-related (CR) service firms which are in a process of internationalization. The authors will focus on the characteristics of service defining its tradability.

The objectives are achieved by first exploring the general drivers and the drivers specific to service firms via qualitative interviews and a literature review. Then, the model is tested empirically on CR service firms using structural equation modeling using partial least squares.

Results show that the degree of tradability of the service influences the choice of entry mode. The higher the degree of tailor-made offer and face-to-face contact with the client, the more firms opt for an entry mode with high control, such as establishment abroad and/or joint-venture. Finally, firm size and international experience are also significant drivers behind the selection of entry mode.

As firms often choose several entry modes simultaneously, it is difficult to lead the research.

In exports of digitalized and standardized services with little face-to-face contact, physical presence abroad is less important for success. It is more difficult to successfully market tailor-made services at the international level. Therefore, firms with limited capabilities should start exporting standardized services requiring limited face-to-face contact. Small firms wishing to become global players should preferably focus on exports of digitalized services and use internet, which is an attractive distribution channel. Moreover, when the confidentiality required for the service is an issue for the company, it is better to start with geographically near markets.

In this research, service tradability came out as an original concept including service-specific characteristics leading to the selection of entry mode(s). The authors focussed on four characteristics of services which are on-line transmissibility, degree of confidentiality required, face-to-face contact, and finally the degree of customizability.

Firms pursue a number of redeployment strategies in order to achieve growth and create value for their stakeholders. While the majority of previous research focuses on how firms create synergic value by sharing resources across multiple business units, we lack a systematic analysis of the determinants of different redeployment strategies. In this paper, we develop a theoretical framework that allows us to systematically investigate how intrinsic resource characteristics affect resource redeployment strategies. Our framework identifies four critical characteristics of resources, that is, fungibility, scale-free nature, decomposability, and tradability. We develop a number of predictions that provide guidance for researchers to identify the optimal resource redeployment strategy appropriate for resources with a certain set of characteristics.

Firms grant non‐tradable stock options to their employees as an incentive device. Is the cost of issuing these options equal to the amount the company would receive if it sold the same options to outside investors? The evaluation of this cost is the main objective of this article. The options granted to employees are not tradable, due to the incentive scheme to which they are related. A non‐tradable option is an asset that cannot be evaluated with standard Black‐Scholes formulas.

The article adopts standard option pricing, introducing some corrections since Black‐Scholes formulae do not apply. The new formulae show the dependence of option values on how diversified both the employees and the firm are; and the influence that the incentive to work by employees has on the stock price.

Once stock options satisfy a participation constraint, they can be granted to employees who stand to gain. However, they do not provide a net benefit in all circumstances to shareholders since they may gain, break even, or lose. Even though in many cases stock options may appear to be an inefficient way to stimulate work effort, in start‐ups and entrepreneurial firms they turn out to be quite beneficial.

Stock option opportunity costs have to be valued taking into account the extent of their non‐tradability and the incentive they provide to employees.

The article introduces a correction for valuing non‐tradable stock options. This permits us to measure properly the opportunity cost of stock options, which is often mis‐specified.

This study aims to identify the factors that influence the willingness of Bangladeshi retail investors to invest in ṣukūk.

The authors surveyed Bangladeshi retail investors using a structured questionnaire to understand their perspectives on potential investment in ṣukūk. The authors considered the behavioral aspects of retail investors and the desired ṣukūk features to analyze the demand side. Factors and regression analyses were performed to identify the persuading factors.

The results indicate that investor awareness is a fundamental factor in potential investments in ṣukūk. Investors perceive the security represented by government and third-party guarantees as a persuasive feature of ṣukūk. The tradability and tenor of ṣukūk also affect the investment intention. Sharīʿah consciousness of the investors also plays a significant role in their investment decisions.

One limitation of this study is that it incorporates potential individual investors only, and precludes institutional investors. In the future, there is scope for research to explore the demand factors impacting institutional investors of ṣukūk in Bangladesh.

The authors expect that the study will aid policymakers and ṣukūk issuers in crafting strategies to cater to the needs of Bangladeshi retail investors.

This study is the earliest research conducted in Bangladesh to determine the factors impacting the willingness of individual investors to make their potential investments in ṣukūk. To the best of the authors' knowledge, no study has analyzed the desired ṣukūk features from the perspective of Bangladeshi retail investors.

The authors analyze the equilibrium effects of non-tradable assets on optimal policy portfolios. They study how the existence of non-tradable assets impacts optimal asset allocation decisions of investors who own such assets and of investors who do not have access to non-tradable assets.

In this theoretical analysis, the authors analyze a model with tradable and non-tradable asset classes whose cash flows are jointly normally distributed. There are two types of investors, with and without access to non-tradable assets. All investors have constant absolute risk aversion preferences. The authors derive closed form solutions for optimal investor demand and equilibrium asset prices. They calibrated the model using US data for listed equity, bonds and private equity. Further, the authors illustrate the sensitivities of quantities and prices with respect to the main parameters.

The study finds that the existence of non-tradable assets has a large impact on optimal asset allocation. Investors with (without) access to non-tradable assets tilt their portfolios of tradable assets away from (toward) assets to which non-tradable assets exhibit positive betas.

The model provides important insights not only for investors holding non-tradable assets such as private equity but also for investors who do not have access to non-tradable assets. Investors who ignore the effect of non-tradable assets when reverse-engineering risk premia from asset covariances and market capitalizations might severely underestimate the equity risk premium.

The authors provide the first comprehensive analysis of the equilibrium effects of non-tradability of some assets on optimal policy portfolios. Thus, this paper goes beyond analyzing the effects of market imperfections on individual portfolio choices.

This paper reviews the theoretical case for industrial policy (coordination) provided by theories of multiple equilibria. It is argued that for most less developed countries the case for industrial policy (government coordination) is best made with respect to agriculture. Those states that have succeeded in terms of government policy promoting economic development, began with the agricultural sector.

This paper presents a model of resources refinement for systematically and comprehensively deriving competence-based competitive advantages. Competence-based competitive advantages support market-based strategies. They reinforce the overall market-based advantages of low costs, product differentiation and minimal cost differentiation at the business unit level and of carrying out tasks jointly in a performance compound at the corporate level. Competence-based competitive advantages also support resource-based strategies by reinforcing the advantages of product innovation skills at the business unit level and transfer of core competences in a performance compound at the corporate level.

This chapter discusses the global factory paradigm. We show how mainstream international business (IB) thinking, namely, internalization theory, can guide multinational enterprise (MNE) strategic decision-making in the context of a global factory network.

We identify the key assumptions made in the global factory paradigm about the fine slicing of economic activities and the related implications for the ownership status and location of each activity. In order to overcome the global factory paradigm’s relative lack of predictive capacity, as compared to internalization theory, we propose an asset-bundling approach. This approach uses a clear and unambiguous criterion, namely, the tradability of resources (and resource combinations) to determine which sets of activities can best be left to external market contracting or should on the contrary be internalized on the basis of efficiency considerations.

We describe the enhanced role of developing/transition countries in the functioning of the global economy and show that these countries represent an increasing share of worldwide economic activities. Given this macrolevel development, the global factory, as a complex organizational form governing both internal activities and contracts with external parties, is rapidly gaining in importance. We describe, at the conceptual level, the strengths and weaknesses of the global factory and propose a “decision dynamics” matrix to support global factory, senior managers’ strategies in the realm of ownership status and location.

Future research on the MNE should focus on in-depth analysis of firms that embody “global factory”-type characteristics in order to understand better the evolution of this type of company and to capture the close requisite links among the focal firm, external contracting parties, and the broader environment. Such research should also lead to a better understanding of innovative resource combination processes and the transferability of non-location-bound firm-specific advantages (FSAs) across the global factory network.

In the global factory, the MNE head office assumes the role of resource orchestrator and is responsible for key strategic decisions on ownership status and location. Here, the head office must assess critically the operations that are part of the MNE’s value chain and reflect on the firm’s international dispersion of economic activities on an ongoing basis, given a myriad of broad environmental changes and changes in external competitive pressures. Our “decision dynamics” matrix provides a simple but effective managerial tool supporting MNE ownership status and location decisions, but the head office’s capability to make these decisions should not be overestimated.

We explicitly link internalization theory with the global factory paradigm and explore unresolved issues in the relevant literature. Internalization theory prescribes the optimal ownership status and location for each economic activity considered. The theory focuses on the bundling of firm-level resources and complementary ones held by external parties, for each fine-sliced economic activity. It also considers explicitly the nature of the linkages among these activities.

The purpose of this paper is to investigate and assess the trends of bilateral services trade in the world segmented by trade for final consumption and intermediate usage across several service sectors. The differential trends, if any, are studied while examining the role of free trade agreements which have a chapter on services trade as well as the role of services trade restrictions. The study unravels differences across service sectors in this respect.

The author uses an augmented gravity model to address the above using OECD- World Trade Organization (WTO) TiVA data for bilateral trade in intermediates and final products (October 2015 release) and World Bank Services Trade Restrictions Index (STRI). The poisson pseudo maximum likelihood estimation technique is used in light of the structure of the data. Trade creating and diverting effects are identified controlling for time and country-time specific effects. The following sectors are specifically looked at: total business sector services, computer and related services, financial intermediation, post and telecommunication, transport and storage, R&D and other business services, hotels and restaurants, construction, and wholesale and retail trade.

First, services free trade agreements (FTAs) have had a trade creating impact with no trade diverting impact for services trade in aggregate with stronger effects on services traded for intermediate usage. Second, financial intermediation and post and telecommunication have been left unaffected by services FTAs. While no trade diversion is concluded for any sector, R&D and other business services, transport and storage and wholesale retail trade show maximum trade creation effects in response to FTAs. Third, trade restrictions of mainly OECD countries are responsible for lowering exports for most sectors. Finally, in terms of policy implications, at a general level, the author does not find a significant difference in the author’s results for services traded for intermediate usage or final consumption except for a stronger effect of FTAs on intermediate services trade. Hence, the policies to foster services trade on both counts are concluded to be the same and deal with behind-the-border policies of domestic industrial policy reforms like national treatment of foreign firms, licensing requirements, FDI policies, etc.

Statistics for services trade are limited. The data are only available for the years 1995, 2000, 2005, 2008, 2009, 2010 and 2011. Additionally, the conclusions on services trade restrictions are based on statistics for 2011 alone, since this is the only year for which the statistics are available. A complete time series for the entire sample period would increase robustness of the study with a better time variant version of the trade restrictiveness variable. Finally, in the construction of the OECD-WTO-TiVA database of a world IO table, there may have been approximations in constructing statistics for services traded for intermediate usage and final consumption. The results remain sensitive to the same but this is the best possible statistics available for the purposes.

This is the first study which looks at services trade segmented by trade for final consumption and intermediate usage taking advantage of the available data for a number of service sectors. The role of restrictions is also studied for the first time segmented by trade in intermediates and final consumption. The stronger effects of FTAs on intermediate services trade as well as financial intermediation and post and telecommunication services being insulated from effects of FTAs are important findings, especially since services are mainly thought to be traded for final consumption. Similar trends of results for services traded for intermediate usage and final consumption and restrictions affecting exports from exporter countries and imports by importer countries highlight the importance of behind-the-border domestic policies in facilitating or inhibiting services trade on both counts and more importantly for intermediate usage which, in turn, would improve goods tradability.

Islamic social finance assists in achieving social good and economic justice in societies by closing the gap between rich and poor in a Shariah compliant framework. COVID-19 pandemic has created the opportunity to experience the untapped potential of Islamic social finance in many of the countries. This chapter sheds light on the use of Islamic social finance in Iran in the midst of the pandemic with the objective of sharing some Shariah compliant financial solutions for reducing undesirable consequences of the COVID-19. Iran is a country that has a unique Islamic financial system. Currently, it is the country where constitutionally and statutorily practices only shariah-compliant financing activities. This chapter reveals that tradability of justice shares, introduction of Shariah-compliant crowdfunding platforms, provision of Islamic microfinance vehicles in the form of Al-Qard Al-Hassan loans, payment facilities to factories damaged by COVID-19, low-profit rate Murabaha facilities for housing sector are some Shariah-compliant social finance products which were provided in Iran in the midst of the pandemic to provide financial solutions to fulfil the need of the society in a convenient and effective manner.