supplier development at honda nissan and toyota comparative case studies of organizational capability enhancement what factors facilitate and constrain the sustained development and replication of organizational capabilities at suppliers this question is addressed in a comparison of historical case studies at toyota nissan and honda in japan first as expected replication difficulty is overcome by enabling companies to share the practice rather than the representation of tacit knowledge second the interdependence in the hierarchy of routines that constitute organizational capabilities has led companies to broaden the scope of supplier development over time third this broadening challenges suppliers to accept customer companies intervention in internal investment decisions requiring a certain mode of corporate governance it is argued that the boundary of a capability based firm may go beyond legally distinct units of financial control when firms are subjected to a cumulative process of capability enhancement

upgrading in global value chains lessons from latin american clusters it has been shown that clustering helps local enterprises in industrial districts overcome growth constraints and compete in distant markets in advanced and less developed countries nevertheless recent contributions have stressed that more attention needs to be paid to external linkages and to the role played by global buyers to foster upgrading at cluster levels in this study we contribute to this debate focusing on the analysis of the relationships existing between clustering global value chains upgrading and sectoral patterns of innovation in latin america we find that sectoral specificities matter and influence the mode and the extent of upgrading in clusters integrated in global value chains

comparing capitalisms and taking institutional context seriously a major limitation of existing international business ib research remains the rather thin view of institutional context in this retrospective we reflect upon and highlight different strategies for overcoming de contextualized perspectives and developing thicker conceptions of institutions drawing on comparative research institutions shape firm behavior not only through their direct or additive effects but have more complex influences by moderating relationships between firm level variables or having interactive or configurational effects related to wider sets of institutions these views can each be extended by adopting a dynamic perspective examining how multinational enterprise mne agency contributes to processes of institutional change ultimately a large gap remains in taking institutions seriously that ib scholars could fill by developing middle range theories that link and compare how particular kinds of institutions or institutional configurations influence particular kinds of mne activities

the effect of asymmetries on optimal hedge ratios there is widespread evidence that the volatility of stock returns displays an asymmetric response to good and bad news this article considers the impact of asymmetry on time varying hedges for financial futures an asymmetric model that allows forecasts of cash and futures return volatility to respond differently to positive and negative return innovations gives superior in sample hedging performance however the simpler symmetric model is not inferior in a hold out sample a method for evaluating the models in a modern risk management framework is presented highlighting the importance of allowing optimal hedge ratios to be both time varying and asymmetric

monetary policy shifts and the term structure we estimate the effect of shifts in monetary policy using the term structure of interest rates in our no arbitrage model the short rate follows a version of the taylor s 1993 discretion versus policy rules in practice carnegie rochester conference series on public policy 39 195 214 rule where the coefficients on the output gap and inflation vary over time the monetary policy loading on the output gap has averaged around 0 4 and has not changed very much over time the overall response of the yield curve to output gap components is relatively small in contrast the inflation loading has changed substantially over the last 50 years and ranges from close to zero in 2003 to a high of 2 4 in 1983 long term bonds are sensitive to inflation policy shifts with increases in inflation loadings leading to higher short rates and widening yield spreads

collective learning in global diffusion spreading quality standards in a developing country cluster this research analyzes how foreign organizational practices diffuse among indigenous enterprises in a developing economy it highlights the collective knowledge building process as central for understanding diffusion based on a longitudinal case study of a cluster of dairy producers in nicaragua a representative low income country it looks at cross border diffusion in conditions that differ significantly from advanced economies the current literature that highlights institutional pressures driving global spread of practices has limits for capturing a significant dynamic caused by increased integration of markets and production by focusing on production organization and practices in a late developing context this paper explains the intertwined process of spreading new standards and changing existing local practices by elaborating the relationship among building collective capabilities learning and standards diffusion this study enriches current views on institutional effects and adds to the practice based literature as well as to the work on developing economy firms in organizational research

the behavior of money and other economic variables two natural experiments abstract the object of this paper is to test the performance of the quantity theory model and the related proposition of monetary neutrality in a context in which to use bernanke s phraseology money move d for reasons that were plausibly unrelated to the current state of the economy we investigate this question using data from two recent episodes of monetary policy regime change the move to floating exchange rates throughout the industrialized world following the breakdown of bretton woods in the early 1970s and the shift toward less expansive monetary policy that to varying degrees took place in these countries a decade or so later the results of this exercise are highly positive the money price relationship that we observe is fully consistent with theory growth shifts in the nominal stock of money and in the price level are highly correlated and bear a one to one relation to one another growth shifts in exchange rates are significantly related both to growth shifts in relative price levels and to growth shifts in relative excess supplies of money the classical neutrality proposition in this context superneutrality in general receives strong though not totally unambiguous support

monetary policy rules macroeconomic stability and inflation a view from the trenches i estimate a forward looking monetary policy reaction function for the federal reserve for the periods before and after paul volcker s appointment as chairman in 1979 using information that was available to the fomc in real time from 1966 to 1995 the results suggest broad similarities in policy and point to a forward looking approach to policy consistent with a strong reaction to inflation forecasts during both periods this contradicts the hypothesis based on analysis with ex post constructed data that the instability of the great inflation was the result of weak fomc policy responses to expected inflation a difference is that prior to volcker s appointment policy was too activist in reacting to perceived output gaps that retrospectively proved overambitious drawing on contemporaneous accounts of fomc policy i discuss the implications of the findings for alternative explanations of the great inflation and the improvement in macroeconomic stability since then

adaptation bridging and firm upgrading how non market institutions and mncs facilitate knowledge recombination in emerging markets how do multinational corporation mnc subsidiaries and local institutions help or hinder emerging market suppliers to upgrade their capabilities drawing on insights from economic sociology and comparative capitalism we posit that in these contexts of scarce resources and inferior technologies upgrading depends on the ways in which organizational and institutional networks enable firms to integrate imported advanced knowledge with local applied knowledge using a combination of field work and unique survey data of argentine auto parts suppliers we show that process upgrading improves significantly when suppliers have ties to seemingly resource weak non market institutions that improve access to a variety of experiential knowledge these institutions act as knowledge bridges helping local firms tap into diverse applied knowledge embedded in isolated industrial districts and adapt frontier advanced practices to their local conditions moreover suppliers appear to benefit from ties to mnc subsidiaries only when they simultaneously collaborate with certain non market institutions that help them recombine experiential knowledge with the standards gained from the subsidiaries

public sector organizations and agricultural catch up dilemma in emerging markets the orchestrating role of embrapa in brazil abstract how can an emerging economy beset by political economic and resource challenges jump start the technology catch up process in the agricultural sector and then forge an ecosystem to facilitate the continual generation and dissemination of innovations equally important how can it maintain the viability and salience of its catch up initiatives subsequent to the entry and inevitable dominance of multinational companies we answer these questions by studying catch up in brazil s soy seeds sector over four decades 1973 2015 in an environment of political and economic uncertainty embrapa a public sector organization forged partnerships to first develop absorptive capacity and innovation capabilities and then build an ecosystem of diverse organizations to generate and disseminate catch up outcomes to farmers and other end users embrapa also developed critical tacit knowledge and complementary assets that along with its emphasis on environmental sustainability and protecting national interests helped maintain its salience even after the entry and market dominance by multinational agribusinesses in addition to demonstrating critical roles for public sector organizations and public private networks in technological catch up in an emerging economy s agricultural sector our study calls into question the prevalent notion of technological catch up as a rush to reach the technological frontier at any cost

the internalisation theory of the multinational enterprise a review of the progress of a research agenda after 30 years this paper reviews the progress of the research agenda initiated by the future of the multinational enterprise 1976 focusing initially on the problem of explaining the existence of the multinational enterprise the agenda soon broadened to encompass the analysis of alternative modes of foreign market entry the role of international joint ventures the impact of innovation on corporate growth and the role of culture in international business the core philosophy based on the coasian nature of the firm and on rational action modelling has remained constant while the widening range of applications has encouraged synthesis with theories developed in other fields of research success in answering any one question invariably generates new questions which must in turn be answered through a further extension of the theory and this dynamic continues to drive the development of the theory today internalisation theory has retained its validity and its vitality over the past 30 years and is currently being extended into new fields of international business research

global value chains a review of the multi disciplinary literature this article reviews the rapidly growing domain of global value chain gvc research by analyzing several highly cited conceptual frameworks and then appraising gvc studies published in such disciplines as international business general management supply chain management operations management economic geography regional and development studies and international political economy building on gvc conceptual frameworks we conducted the review based on a comparative institutional perspective that encompasses critical governance issues at the micro gvc and macro levels our results indicate that some of these issues have garnered significantly more scholarly attention than others we suggest several future research topics such as microfoundations of gvc governance gvc mapping learning impact of lead firm ownership and strategy dynamics of gvc arrangements value creation and distribution financialization digitization the impact of renewed protectionism the impact of gvcs on their macro environment and chain level performance management

the effect of sustainability standard uncertainty on certification decisions of firms in emerging economies voluntary sustainability standards that establish global rules for firms environmental and or social conduct and allow for verification of firm compliance via third party certification hold the promise to govern firms sustainability conduct in a globalizing world economy however the recent proliferation of competing and overlapping global sustainability standards that have been developed by various stakeholders with different agendas creates uncertainties for firms that likely reduce their propensity to adopt any standard without widespread adoption these standards cannot effectively govern firm conduct and in contrast create barriers for firms access to export markets we suggest that the uncertainties associated with competing standards and the effect of these uncertainties on standard certification decisions are especially large for firms in emerging economies because these firms lack access to information about current and future standards and the resources to obtain certifications to multiple standards we theoretically propose and empirically identify three distinct sources of sustainability standard uncertainty i diversity of customer requirements ii dynamism of customer requirements and iii the unpredictability of the future evolution of standard and propose that each of these sources reduces firms propensity to obtain certification to any standard our empirical results based on certifications to food safety standards by a sample of 97 mexican food exporting firms confirm that three distinct sources of sustainability standard uncertainty exist and that all of them negatively impact certification we discuss ethical implications and offer recommendations for both suppliers as well as standard setting organizations

when and where does foreign direct investment generate positive spillovers a meta analysis local firms may attract productivity spillovers from foreign investors yet these vary with local firms awareness capability and motivation to react to foreign entry in consequence spillovers vary across countries at different levels of economic development we apply competitive dynamics theory to analyze these contextual moderators of spillovers and test hypotheses thus derived in a meta analysis of the empirical literature on spillovers our analysis suggests a curvilinear relationship between spillovers and the host country s level of development in terms of income institutional framework and human capital

changes in federal reserve preferences abstract using a model of optimizing central bank behavior i estimate the dynamic behavior of preferences which are captured by the relative weight put on stabilizing inflation versus minimizing the output gap unlike previous work i let this parameter vary continuously over time there is a drastic but steady rise in the weight on inflation around the appointment of paul volcker however i find variation in preferences throughout the sample period the results suggest that preference changes have been more complex than typically assumed in the literature the estimated preference series is used to perform counterfactual experiments and to construct a new measure of monetary shocks

determinants of cross national knowledge transfer and its effect on firm innovation this study examines the determinants of international knowledge flow from a resource based perspective it evaluates the impact of cross national knowledge transfer on firm innovative performance based on 56 027 us patents owned by 53 selected firms in the us based pharmaceutical industry the results suggest that innovative performance is a curvilinear function of the international knowledge content used by a firm to innovate as hypothesized it was found that at 1 low and moderate levels of international knowledge content a firm s strategy to transfer international knowledge improves its innovative performance and at 2 higher levels of international knowledge content there are diminishing marginal returns to transferring knowledge from overseas

global value chains meet innovation systems are there learning opportunities for developing countries summary the innovation systems is literature tends not to emphasize the crucial impact of international knowledge and innovation exchange and collaboration through for example inter firm and intra firm networks and global value chains gvc in developing countries this aspect is crucial with integration in gvc playing a growing and very important role in accessing knowledge and enhancing learning and innovation however there is no agreement in the literature about how innovation systems and gvc interact and how this interaction is likely to affect enterprise learning three main conclusions emerge from the theoretical analysis and evidence presented in this paper first learning mechanisms can vary widely within the various forms of governance of gvc they can be the result of the pressure to achieve international standards or be facilitated by direct involvement of the value chain leaders when the suppliers competence is low and the risk of failure to comply is high when the competences of the actors in the value chain are complementary learning is mutual and is based on intense face to face interactions second as we open is to foreign sources of knowledge the relationship between gvcs and is is nonlinear and endogenous and mutually affecting on the basis of our model we would expect a well structured and efficient innovation system would help to reduce transaction complexity and enable transactions based on relational forms of gvc governance third the internal governance of gvc is a dynamic phenomenon that is subject to continuous adjustments and changes and the nature of the is affects this co evolution 2011 elsevier ltd all rights reserved

comparing capitalisms understanding institutional diversity and its implications for international business this paper examines the role of institutional analysis within the field of international business ib studies within ib institutions matter but the view of institutions tends to be thin utilizing summary indicators rather than detailed description and thus approaches institutions as unidimensional variables that impact on particular facets of business activity this paper argues that ib research would be usefully advanced by greater attention to comparing the topography of institutional landscapes and understanding their diversity a number of alternative case based approaches are outlined that draw on a growing comparative capitalisms literature in sociology and political science the paper develops a number of empirical examples to show the utility and limits of these approaches for ib scholars

bad luck bad policy and learning a markov switching approach to understanding postwar u s macroeconomic dynamics abstract this paper evaluates the role of monetary policy in understanding the u s post war macroeconomic fluctuations we construct a medium size dsge model in which the central bank through a real time learning process can make mistakes in estimating key elasticities between macroeconomic aggregates and the central banks objectives may change over time the model also features time varying volatilities of non policy shocks we find that misperceptions of the persistence of inflation and the slope of the phillips curve could affect optimal monetary policy decision making therefore their accurate prediction is key for achieving successful monetary policy outcomes in addition we argue that the monetary policy shift geared toward inflation stabilization in the late 1970s changed the composition of output making the marginal efficiency of investment shock that proxies for the functioning of the financial sector the most important contributor to the business cycle

managing tacit and explicit knowledge transfer in ijvs the role of relational embeddedness and the impact on performance drawing on organizational learning and economic sociology we address how relational embeddedness between the foreign parent and international joint venture ijv managers influences the type of knowledge i e tacit and explicit transferred to the ijv and how the importance of relational embeddedness varies between young and mature ijvs we also examine the influence of tacit and explicit knowledge on ijv performance our results show the importance that tie strength trust and shared values and systems play in the transfer of tacit knowledge especially for mature ijvs our findings are consistent with uzzi s tenets tacit learning is accumulative assists in explaining explicit knowledge and is enhanced by social embeddedness we also find that the influence of transferred tacit knowledge on ijv performance stems principally from its indirect effect on the learning of explicit knowledge

cognition capabilities and incentives assessing firm response to the fiber optic revolution this study examines how ceo cognition organizational capabilities and organizational incentives interacted to shape firm strategy during the fiber optic revolution i tested for these factors as

from inflation to more inflation disinflation and low inflation volume 2 of a history of the federal reserve forthcoming covers the years of inflation and disinflation followed by a return to relatively low inflation it addresses four questions why did inflation start why did it continue for 15 or more years from 1965 to about 1982 why did it end why did it not return as we look back to the 1950s and 1960s two of the many changes in the federal reserve system affecting inflation deserve comment first in the 1950s the goal was price stability and zero reported inflation not inflation of about 2 percent the 1959 1960 disinflation brought reported consumer price index cpi inflation measured as a 12 month moving average to less than 1 percent from march through august 1959 this measure again was below 1 percent through most of 1961 and it did not reach 2 percent until early 1966 properly measured and adjusted for biases in the price index the true price level probably declined modestly during this period this period of deflation was also a period of sustained economic growth it and several periods of deflation discussed in volume 1 of a history of the federal reserve 2003 show no evidence of the liquidity trap that absorbed much recent attention in the united states and japan a second major change is the role of economists and economic research at the federal reserve board and in the federal reserve banks in the 1950s the board had no economists as members and there were few economists as

network composition collaborative ties and upgrading in emerging market firms lessons from the argentine autoparts sector what types of relational and institutional mechanisms shape knowledge flows and the upgrading capabilities of emerging market firms in the face of economic liberalization we analyze the argentine autoparts sector to distinguish the relative impact of different types of network relationships on a firm s process and product upgrading a few social ties to international assemblers appear to be most beneficial for local suppliers although they may be insufficient to compensate fully for the negative effect of being located in a lower tier supplier customer relationships that are part of regular disciplined discussions for product and process improvements appear to be especially beneficial for upgrading

developed country mnes investing in developing economies progress and prospect this study reviews research from 1970 through 2016 on developed country multinational enterprises dmnes entering and competing in developing economies to identify the current state of knowledge of this research and push it further we review the literature using bibliometric and qualitative content analyses covering leading journals and books we articulate frontier issues that are understudied yet critical to both theorization and practice of dmnes in developing economies we discuss the findings and conclusions from prior research along five key areas 1 entering developing economies 2 organizing local activities 3 managing alliances and joint ventures 4 competing in dynamic environments and 5 dealing with institutions governments and society we offer prospective insights into future agenda that have important implications for mne strategies and decisions and propose frontier directions that encompass strategic localization reverse transfer and adaptation co evolution with local business ecosystems reorganizing and restructuring and strategic responses to institutional and market complexity

partnering with leviathan the politics of innovation in foreign host state joint ventures forming international joint ventures ijvs with political institutions in emerging economies involves both benefits and risks for multinational enterprises mnes while political partners can provide ijvs with various resources their political status equips them with a strong position to appropriate rents in ijvs we address this tension by examining how host state ownership affects both innovation inputs and outputs in china based ijvs over 2008 2013 despite the potential government opportunism we find more r d investment innovation inputs made in ijvs with state partners than in those with private ones thus r d investment can be politically motivated and symbolically managed to ensure continued resource exchanges with the host state this political pressure is mitigated when foreign parents directly transfer home country based technology to ijvs when the host market dependence of ijv is weak and when ijvs are located in a deregulated region moreover we find foreign host state jvs deliver fewer innovation outputs measured by patent data than foreign private jvs which implies the failure of state partners to adequately absorb foreign technologies these findings highlight both the state partners powerfulness to boost ijv innovation investment and their limits in shaping ijv innovation outcomes and bear rich implications for the management of mne host government relationships

a commentary on does the fed contribute to a political business cycle abrams and iossifov 2006 find that during 1957 2004 monetary policy turned significantly more expansionary prior to u s presidential elections when the federal reserve chairman and the incumbent president belonged to the same political party however their long sample period obscures changes in trends during the period stemming from advances in macroeconomic theory and in the implementation of monetary policy indeed when one considers only the volcker greenspan era 1979 2004 there is insufficient evidence to accept the notion of a political business cycle effect

knowledge transfer from international joint ventures to local suppliers in a developing economy using in depth data from 155 pakistani auto components suppliers we study the role of socialization in knowledge transfer from international joint venture assemblers we find that whereas formal socialization mechanisms enhance the comprehension and speed of knowledge transfer to local suppliers informal socialization mechanisms enhance comprehension but not speed building on structural contingency theory we find that having a mechanistic organizational structure among knowledge recipients is an antecedent to formal socialization leading to improved knowledge transfer

adjusting to and learning from institutional diversity toward a capability building perspective this paper identifies two main dimensions institutional diversity and dynamism in the research stream that has substantively engaged with the important contribution of jackson and deeg j int bus stud 39 4 540 561 2008 taking into account their core criticism that institutional analysis in international business research is often de contextualized and building on these two dimensions we present two possible paths for institutional analysis that are sensitive to context the first is a methodological shift towards configurational analyses and specifically the analysis of counterfactual scenarios that could reveal new information about decision alternatives the second is a shift away from a focus on costs and towards the possibility of mnes building capabilities in an exploratory manner when confronted with institutional diversity both approaches build on an understanding of mnes as strategic actors that co evolve with their environments

performance of utility based hedges abstract hedgers as investors are concerned with both risk and return however when measuring hedging performance the role of returns and investor risk aversion has generally been neglected in the literature by its focus on minimum variance hedging in this paper we address this by using utility based performance metrics to evaluate the hedging effectiveness of utility based hedges for hedgers with both moderate and high risk aversion together with the more traditional minimum variance approach to examine this for an energy hedger we apply our approach to wti crude oil for three different hedging horizons daily weekly and monthly we find significant differences between the minimum variance and utility based hedging strategies in sample for all frequencies however performance differentials between the different strategies are small and not economically significant out of sample results support these findings across all frequencies