longitude matters time zones and the location of foreign direct investment abstract using bilateral foreign direct investment fdi data we find that differences in time zones have a negative and significant effect on the location of fdi we show that this finding is robust across different specifications estimation methods and proxies for time zone differences time zones also have a negative effect on trade but this effect is smaller than that on fdi finally the impact of the time zone effect has increased over time suggesting that it is not likely to vanish with the introduction of new information technologies

interaction between the formal and informal financial sectors the asian experience abstract the nature of the interaction between the formal and informal financial sectors in developing countries is a subject with important policy implications it has implications for the future of informal finance as the formal sector expands in the long term will the informal sector wither away as the traditional view of financial dualism assumes or will it continue to play an important complementary role perhaps even growing in absolute size second the pattern of two major policy approaches often advocated toward the informal sector offering it stronger competition so as to induce it to improve its terms and promoting linkages with it so as to take advantage of its lower transactions costs in reaching smaller and poorer borrowers third the existence of a large informal sector has implications for the efficacy of monetary and credit policy in achieving stabilization objectives fourth the interaction between the formal and informal financial sectors also has implications for the effects of financial liberalization through removing restrictions on the deposit rate of interest this paper draws on the experience of asian countries to address these issues

financial inclusion and financial integrity aligned incentives summary the financial action task force embraces financial inclusion as complementary to anti money laundering and counter terrorist financing as it enhances transparency this support is based on the premise that the increased use of formal financial services leads to a reduction of usage of informal services we present evidence on eight african countries that both are not negatively associated moreover informal employment and cash preference reduce the inclination to use mobile financial services if an increase in transparency acts as disincentive to use formal services the alignment of financial inclusion and integrity will fail

specialized supplier networks as a source of competitive advantage evidence from the auto industry this study examines the relationship between interfirm asset specificity and performance in the auto industry more specifically i examine the extent to which differences in supplier automaker asset specialization may explain performance differences between japanese automakers nissan and toyota and u s automakers chrysler ford general motors the findings indicate a positive relationship between supplier automaker specialization and performance in particular the data suggest a positive relationship between interfirm human asset cospecialization and both quality and new model cycle time moreover site specialization is found to be positively associated with lower inventory costs the findings suggest that in the auto industry a tightly integrated production network characterized by proximity and a high level of human cospecialization will outperform a loosely integrated production network characterized by low levels of interfirm specialization

assets and actions firm specific factors in the internationalization of u s internet firms by providing a nearly instant connection among parties at opposite corners of the world and enabling a variety of commercial exchanges the internet emerged as the technology expected to create a truly global market space internet firms faced the challenge of capitalizing on this development in this paper we examine what firm specific factors are associated with the propensity of pure u s based internet firms to enhance their international presence on the internet by developing country specific websites despite the assertion that all internet firms are born global our findings show that the pursuit of internationalization by internet firms is related to the levels of their intangible assets and strategic activity two types of intangible assets reputation and website traffic are positively related to the degree of internationalization so are the levels of competitive and cooperative activity and the interaction effects between reputation and competitive and cooperative activity these findings suggest that ideas from both resource based theory and research on competitive dynamics can contribute to understanding the internationalization of internet firms

client perceived performance and value in professional b2b services an international perspective drawing from the resource based view and a contingency approach the authors develop and test a model of the antecedents of client perceived value in the context of international professional business to business services consultants engineers project management it consultants etc in a developing economies setting further we examine the effects of key moderators e g country of origin coo firm s international experience client s buying experience on client perceived performance and value the results generally support the hypotheses that client perceived performance is impacted by a firm s internal resources e g technical skills customer orientation innovation in addition this relationship is contingent upon the coo effect while client perceived value is moderated by the client s buying experience the findings can guide practitioners as to the key drivers of client perceived value and under what conditions this value is maximized

the underground economies tax evasion and information distortion list of contributors preface introduction edgar l feige part i the meaning measurement and policy implications of the underground economies 1 the meaning and measurement of the underground economy edgar l feige 2 information distortions in social systems the underground economy and other observer subject policymaker feedbacks robert r alford and edgar l feige 3 policy illusion macroeconomic instability and the unrecorded economy robert t mcgee and edgar l feige 4 how large or small should the underground economy be bruno frey part ii the underground economy in western developed nations measurement in different laboratories 5 monetary perspective on underground economic activity in the united states richard d porter and amanda s bayer 6 the unrecorded economy and the national income accounts in the netherlands a sensitivity analysis g a a m broesterhuizen 7 assessing the underground economy in the united kingdom michael o higgins 8 the underground economy in the federal republic of germany a preliminary assessment enno langfeldt 9 the underground economy in sweden ingemar hansson 10 the irregular economy of italy a survey of contributions bruno contini 11 the hidden economy in norway with special emphasis on the hidden labor market arne jon isachsen and steiner strom 12 canada s underground economy rolf mirus and roger s smith 13 the underground economy in france philippe barthelemy part iii the underground economy under central planning 14 the soviet second economy in a political and legal perspective f j m feldbrugge 15 second economy and socialism the hungarian experience istvan r gabor bibliography

new silicon valleys or a new species commoditization of knowledge work and the rise of knowledge services clusters this paper explores knowledge services clusters kscs as a distinct and increasingly important form of geographic cluster in particular in developing countries kscs are defined as geographic concentrations of lower cost skills serving global demand for increasingly commoditized knowledge services based on prior research on clusters and services offshoring and data from the offshoring research network orn major properties and contingencies of ksc growth are discussed and compared with both high tech clusters and low cost manufacturing clusters special emphasis is put on the ambivalent effect of commoditization of knowledge work on ksc growth it is proposed that kscs attract most client projects if service commoditization is medium whereas higher or lower commoditization either increases global competitive pressure or lowers demand and economies of scale and scope ksc attractiveness is further related to the perceived availability of skills at relatively low costs and cluster connectedness with client economies through corporate networks and professional communities findings not only advance current debates on clusters global services sourcing and the geography of knowledge production but also have important policy implications

on some criticisms of critical realism in economics methodological comments on critical realism in economics have proliferated over the past decade typically focusing on tony lawson s economics and reality and reorienting economics which constitute the core of this project in the present paper we select a series of important mostly very recent arguments against critical realism in economics and assess their merits and demerits

realist philosophy of the social sciences and economics a critique this paper deals with critical realism as a contribution to the philosophy of the social sciences in the first section critical realism is introduced differences from other philosophies of sciences espicially positivism and falsificationism are discussed in the second section critical realism is criticised first for failing as a normative philosophy of science second for relying upon an impoverished notion of knowledge acquistion and finally for its unsuitablity as a contribution to social theory

synthesizing the malthusian and senian approaches on scarcity a realist account food entitlement decline fed and food availability decline fad are two approaches to explaining famines that have different policy implications one focuses on the systemic level whereas the other is concerned with the individual level they therefore analyse relatively distinct causal mechanisms thus an important question is whether these approaches can be reconciled another related question is how fad and fed based explanations relate to classical malthusian views about rapid food requirement increase fri this paper analyses these questions and argues that these three approaches can indeed be reconciled within a single framework by outlining the causal sources of fad fed and fri this task requires among other things the separation of ontological categories and empirical measures as a consequence of this argument the paper suggests that there are only seven possible ontological combinations of how a famine situation can arise as a direct cause simultaneously it maintains that there are virtually an infinite number of ways in which these combinations may act as indirect causes rooted in economic political and social conditions the analysis is exemplified by the bengal famine of 1943 because that famine is a well known case the wider research and policy applicability of this general account are discussed but have yet to be tested in relation to other scarcity cases water land fish this synthesis is made possible by the incorporation of critical realist interventions into economic theory

on the relationship between firm size and export intensity export marketing literature supports the view that firm size is positively related to export intensity although the empirical findings have been mixed a number of theoretical arguments are used to support this proposition i e international marketing economies of scale limited managerial and financial resources of small firms decisionmaker s risk perception based on a large survey of the italian manufacturing industry the article falsifies the proposition and challenges some widely held assumptions in export marketing literature

abstraction tendencies and stylised facts a realist approach to economic analysis in his numerous methodological asides and assertions that feature in his more empirically oriented postwar contributions nicholas kaldor makes frequent reference to notions of abstraction tendencies and stylized facts however the employment of such terms seems rarely to be explicitly questioned justified or explicated this paper argues that such notions can be readily explicated and their employment justified through adopting an explicitly realist approach to economic analysis it is also argued that realism represents a serious alternative to current orthodox approaches to economics without suffering from some of the latter s more obvious limitations copyright 1989 by oxford university press

concentration and dispersion in global industries remote electronic access and the location of economic activities we explore how the possibility of remote electronic access to markets resources and knowledge enabled by the new information and communication technologies icts might change the motivations of firms to locate activities internationally and in turn affect worldwide dispersion and concentration in an industry preliminary results from an exploratory analysis of the spatial distribution of firms in financial services suggest that the introduction of a business to business b2b trading network increases the global market participation of firms from peripheral countries but does not appear to reduce the importance of locational clusters a set of propositions is derived that provide guidance for more detailed research on the impact of icts on the strategy and structure of global industries

global disaggregation of information intensive services information intensive services are being globally disaggregated as corporations respond to the pressures of increasing global competition and take advantage of the opportunities made available by the progress of information technology and the emerging global work force in order to globally disaggregate services corporations must decide whether or not to carry out a service activity within the organization and where to locate it within or outside the geographic boundary of the home base country this paper analyzes the opportunities and challenges of global disaggregation of information intensive services specifically the paper proposes a taxonomy of disaggregation and develops a theoretical framework that identifies the criteria and guidelines for successfully selecting service activities to be globally disaggregated

offshoring administrative and technical work new fields for understanding the global enterprise in this paper we introduce the journal of international business studies special issue on offshoring administrative and technical services ats in doing so we have attempted to locate the topic within the international business research tradition as well as suggest challenges and opportunities that the phenomenon offers to theoretical and empirical research in the field we examine the interplay of costs knowledge and innovation in the evolution of ats offshoring from modest beginnings to its current stature as an accepted business practice we suggest that understanding the continuing evolution of ats offshoring requires researchers to take into account not only the business imperative of cost saving but also a more complex set of underlying factors and potential outcomes we argue that the rapid growth of ats offshoring has brought about an accumulation of resources including financial flows knowledge infrastructure and human capital to create new platforms for knowledge creation and innovation low costs may characterize the initial conditions for offshoring but they also provide the basis for up market moves as firms increasingly pursue innovation based strategies we introduce the papers in the special issue as integral elements in our discussion contributing new ideas that stimulated our thinking and hopefully will do the same for others seeking to understand this emerging area of globalization and international managerial practice journal of international business studies 2009 40 887 900 doi 10 1057 jibs 2009 22

from the editors common method variance in international business research jibs receives many manuscripts that report findings from analyzing survey data based on same respondent replies this can be problematic since same respondent studies can suffer from common method variance cmv currently authors who submit manuscripts to jibs that appear to suffer from cmv are asked to perform validity checks and resubmit their manuscripts this letter from the editors is designed to outline the current state of best practice for handling cmv in international business research

outsourcing and offshoring implications for productivity of business services this paper reviews the implications of outsourcing and offshoring for the productivity of business services in the uk official statistics indicate that business service productivity has grown by over 20 per cent in the last 7 years at the same time as employment grew by 20 per cent the paper considers possible factors that account for the simultaneous growth of employment and productivity first we discuss outsourcing and offshoring and their role in enhancing productivity through greater specialization standardization and consolidation of business processes and a shift to higher value added services outsourcing of business services is interpreted as part of corporate restructuring namely as the unbundling of corporate functions as well as vertical disintegration second as some services become more like products both low skilled and high skilled jobs are subjected to productivity growth through standardization and digitization it is argued however that the future of business service productivity is on a knife edge depending on the mix of two sources of productivity enhancement namely greater standardization and capturing value from customized solutions copyright 2006 oxford university press

offshoring and the global distribution of work implications for task interdependence theory and practice a recent offshoring research network orn global survey of offshoring shows that since 2004 management concerns about operational issues on achieving the benefits of offshoring have increased significantly in this paper we examine inter task interdependence a key operational determinant of inter site interaction and communications in offshoring we analyze existing theories of interdependence to examine the extent to which they provide guidance for understanding the interaction and communication requirements between work segments that are offshored and distributed across the globe using a series of mini cases on globally distributed work gdw we show how the traditional typology of interdependence developed in the 1960s and 1970s is no longer adequate for understanding and managing task interdependencies in gdw we propose three concepts to address this problem integration interdependence hand offs and information stickiness we then show how our revised typology of interdependence enables a better understanding of the interactions and communication requirements between sites using this revised theory we propose guidelines for work design and examine their implications for practical offshoring and work distribution decisions implications for theory and practice for mnes engaged in offshore relationships are discussed

shadow economies size causes and consequences using various methods the size of the shadow economy in 76 developing transition and oecd countries is estimated average size varies from 12 percent of gdp for oecd countries to 23 percent for transition countries and 39 percent for developing countries increasing taxation and social security contributions combined with rising state regulations are driving forces for the increase of the shadow economy especially in oecd countries according to some findings corruption has a positive impact on the size of the shadow economy and a growing shadow economy has a negative effect on official gdp growth

the silicon valley hsinchu connection technical communities and industrial upgrading silicon valley in california and the hsinchu taipei region of taiwan are among the most frequently cited miracles of industrialization in the information technology era since the region s transformation from an agricultural valley into the birthplace of the semiconductor industry in the 1950s silicon valley firms have pioneered a wide range of technology related industries the regional economy has adapted flexibly to fast changing markets and local producers continue to define the state of the art in successive generations of technology from semiconductor equipment personal and handheld computers and networking hardware and software to biotechnology multimedia software and internet related infrastructure and services taiwan s technology achievements are more recent but no less impressive the taipei area which served as a source of low cost labor for consumer electronics production as late as the 1970s is known today for the speed and flexibility of its personal computer manufacturers these firms dominate the markets for a large and growing range of computer rela ted products from motherboards and monitors to optical scanners and power supplies meanwhile the hsinchu science based industrial park established in 1980 is now a state of the art manufacturer of semiconductor s on par with the world market leaders in the us and japan taiwan s total information technology output is now greater than that of larger nations like korea in fact it is larger than the output of germany and france combined anderson 1998

credit reporting financial intermediation and identification systems international evidence abstract credit reporting systems are an important ingredient for financial markets these systems are based upon the unique identification of borrowers which is enabled if a compulsory national identification system exists in a country we present evidence derived from difference in difference analyses on the impact of credit reporting and identification systems on financial intermediation in 172 countries between 2000 and 2008 our results suggest that the introduction of a mandatory identification system has a positive effect on financial intermediation bank credit to deposits net interest margins and financial access private credit to gdp especially in countries where there is also a credit reporting system

why are companies offshoring innovation the emerging global race for talent this paper empirically studies determinants of decision by companies to offshore innovation activities it uses survey data from the international offshoring research network project to estimate the impact of managerial intentionality past experience and environmental factors on the probability of offshoring innovation projects the results show that the emerging shortage of highly skilled science and engineering talent in the us and more generally the need to access qualified personnel are important explanatory factors for offshoring innovation decisions moreover contrary to drivers of many other functions labor arbitrage is less important than other forms of cost savings the paper concludes with a discussion of the changing dynamics underlying offshoring of innovation activities suggesting that companies are entering a global race for talent

securing access to lower cost talent globally the dynamics of active embedding and field structuration manning s sydow j and windeler a securing access to lower cost talent globally the dynamics of active embedding and field structuration regional studies this article examines how multinational corporations shape institutional conditions in emerging economies to secure access to high skilled yet lower cost science and engineering talent two in depth case studies of engineering offshoring projects of german automotive suppliers in romania and china illustrate how multinational corporations engage in active embedding by aligning local institutional conditions with global offshoring strategies and operational needs multinational corporations thereby contribute to the structuration of field relations and practices of sourcing knowledge intensive work from globally dispersed locations the findings stress the importance of institutional processes across geographic boundaries that regulate and are shaped by multinational corporation activities manning s sydow j and windeler a

the next wave of globalization relocating service provision to india summary services offshoring to india has grown dramatically in the last 10 years it is linked to the earlier expansion of indian software services exports but has its own dynamic and workforce although domestic firms were early entrants mncs are central actors already some work done in india resembles that done in developed countries to explain the dynamism and complexity of offshoring a taxonomy of market participants is presented offshoring by small entrepreneurial us firms is highlighted as an emerging phenomenon the conclusion argues that market entry by other developing countries is possible

metatheory as the key to understanding schumpeter after shionoya in his recent book yuichi shionoya departs from previous schumpeterian studies he sets out to reconstruct schumpeter s metatheoretical framework which he argues is the key to a correct interpretation of his substantive writings the centrepiece of this project is the thesis that schumpeter has a coherent methodological position instrumentalism which consistently underpins his theoretical work the present paper examines this thesis and in so doing paves the way for an alternative hypothesis on schumpeter this hypothesis is based on tony lawson s work on the philosophy of economics

network linkages and location choice in foreign direct investment this paper shows that network linkage is an important determinant of location choice in foreign direct investment fdi network linkages are divided into internal intra firm and external inter firm linkages external linkages are further separated into strategic and relational linkages we found that taiwanese firms are keen on making external linkages but are indifferent to or incapable of making internal linkages through fdi strategic linkages motivate taiwanese fdi in the united states while relational linkages facilitate taiwanese fdi in southeast asia and china small firms are more sensitive to relational linkages than large firms in their choice of fdi location

mobile money financial inclusion and development a review with reference to african experience we survey literature on mobile money and its contribution in promoting financial inclusion and development with a focus on sub saharan africa we use taxonomic descriptive and analytical methods to evaluate the state of knowledge in the area we analyse how mobile technology in general may contribute to economic development and financial inclusion in theory and practise we explain the mechanics of mobile money using kenya s m pesa as a canonical example and consider whether the literature has fully established the potential economic impact of mobile money especially its contribution to financial inclusion we also consider market structure pricing and regulatory implications of mobile money we conclude by highlighting issues that require further investigation the take up of mobile money mobile money and financial inclusion substitutability between mobile money and conventional finance and regulatory structures for institutions providing mobile money services

what do we know about the shadow economy estimates of the size of the shadow economy in 21 oecd countries are presented the average size of the shadow economy as a percentage of official gdp over 1999 2000 in these countries is 16 7 the author concludes that it is the increasing burden of taxation and social security contributions combined with rising state regulatory activities that are the driving forces for the recent growth in size of the shadow economy in the countries concerned

how do flexible labour markets really work the role of profitability in influencing unemployment this paper assesses the theoretical justifications available for policies of flexible labour markets flms in reducing the level of unemployment in developed economies it empirically assesses the oecd s rationalisation of policy linking profitability to investment and job creation in four country cases new capital investment is found to be significant for unemployment in all cases but it is not found to be a consequence of the mechanistic achievement of normal profits without an empirically supported mechanism for how flms reduce unemployment the policy is open to the accusation of being no more than a political tool for altering distribution without concern for the wider socio economic consequences copyright the author 2008 published by oxford university press on behalf of the cambridge political economy society all rights reserved oxford university press

task attributes and process integration in business process offshoring a perspective of service providers from india and china this study addresses an important issue in designing and managing business process offshoring bpo process integration between an offshore service provider and its global bpo client we applied the information processing lens in global bpo and developed the logic that internationally disaggregated process integration requires a fit between process integration and bpo s task characteristics i e task complexity and security and task interdependence task connectivity stickiness and dependency this alignment is further moderated by the task context such as the geographic dispersion of the global client s end customers and the type of offshore provider independent vendor vs captive and joint venture finally we suggest that process integration has a positive but curvilinear relationship with the economic returns achieved by offshore providers our analysis of 308 bpo companies in india and china supports our propositions we conclude that international managers monitoring and integrating globally disaggregated activities in bpo should establish a proper alignment with the bpo project s task traits and task interdependence and look closely at the conditioning effect of external complexity by redressing the paucity of research on governing global bpo this study offers some insights into the integration externalization dynamics for growing business knowledge process offshoring

are foreign it workers cheaper u s visa policies and compensation of information technology professionals the use of h 1b and other work visas to hire foreign information technology it professionals in the united states has attracted significant controversy and policy debates on one hand hiring high skill foreign it professionals on work visas can be advantageous for u s firms and the overall economy on the other hand high skill immigration can adversely impact the wages of foreign and american it professionals this study uses data on skills and compensation of more than 50 000 it professionals in the united states over the period 2000 2005 to study patterns in compensation of foreign and american it professionals to inform these debates contrary to the popular belief that foreign workers are a cheap source of labor for u s firms we find that after controlling for their human capital attributes foreign it professionals those without u s citizenship and those with h 1b or other work visas earn a salary premium when compared with it professionals with u s citizenship the salary premiums for non u s citizens and for those on work visas fluctuate in response to supply shocks created by the annual caps on new h 1b visas setting lower and fully utilized annual caps results in higher salary premiums for non u s citizens and those with work visas we discuss implications of this study for crafting informed visa and immigration related policies by the u s government for staffing practices of firms and for human capital investments by it professionals

global delivery models the role of talent speed and time zones in the global outsourcing industry global delivery models gdms are transforming the global it and business process outsourcing industry gdms are a new form of client specific investment promoting service integration with clients by combining client proximity with time zone spread for 24 7 service operations we investigate antecedents and contingencies of setting up gdm structures based on comprehensive data we show that providers are likely to establish gdm location configurations when clients value access to globally distributed talent and speed of service delivery in particular when services are highly commoditized findings imply that coordination across time zones increasingly affects international operations in business to business and born global industries

capabilities structure agency and evolution this paper examines conceptual issues and reviews empirical results bearing on the relationship between research approaches emphasizing organizational capabilities and those based in transaction cost economics tce or in organizational economics more generally following a review of conceptual fundamentals what capability is and why organizations differ in capability it assesses recent progress toward an integration of the capabilities and transaction cost approaches primarily in the context of the analysis of vertical structure and related phenomena this review suggests that progress has been substantial and that the key elements of a promising dynamic synthesis have been identified the paper then considers issues that call for attention if further progress is to be achieved the first of these is the role of agency which must be seen in expansive terms relative to standard economic rationality if its evolutionary significance is to be fully appreciated the second is the role of structure or more specifically industry architecture which affects capability development by way of its effect on the feedback that firms receive after drawing on the recent financial crisis for an illustration of these ideas this paper considers the rise of interest in business models as a useful field of application and it concludes with a discussion of the role of organizational economics beyond tce we argue that whatever the theoretical perspective at the level of the firm analyses must reach beyond that level to grasp the important causal forces affecting capability development firm boundaries and structural features more generally

the uppsala internationalization process model revisited from liability of foreignness to liability of outsidership the uppsala internationalization process model is revisited in the light of changes in business practices and theoretical advances that have been made since 1977 now the business environment is viewed as a web of relationships a network rather than as a neoclassical market with many independent suppliers and customers outsidership in relation to the relevant network more than psychic distance is the root of uncertainty the change mechanisms in the revised model are essentially the same as those in the original version although we add trust building and knowledge creation the latter to recognize the fact that new knowledge is developed in relationships

the impact of formal financial inclusion on informal financial intermediation and cash preference evidence from africa this paper examines the effect of formal financial intermediation inclusion on informal financial intermediation and the use of cash for economic activities using data from the global findex 201

the nature of heterodox economics heterodoxy serves as an umbrella term to cover the coming together of separate projects or traditions in answering the question what distinguishes heterodoxy from the orthodoxy the author argues that matters of ontology are central in answering the question how are the various traditions that make up the modern heterodoxy to be distinguished from each other the author defends criteria other than varying commitments to specific substantive theories policy measures or techniques or basic units of analysis