submarkets and the evolution of market structure we construct a model of industry evolution in which the central force for change is the creation and destruction of submarkets firms expand when they are able to exploit new opportunities that arrive in the form of submarkets they contract and ultimately exit when the submarkets in which they operate are destroyed this simple framework can transparently explain a wide range of well known regularities about industry dynamics most notably the subtle relationships between size age growth and survival data on the laser industry where submarkets are prominent further illustrate the ability of the model to explain distinctive patterns in the evolution of industries and firms

foreign direct investment mode choice entry and establishment modes in transition economies in this study we bridge two streams of foreign direct investment literature specifically studies on establishment mode choice i e the choice between an acquisition and a greenfield establishment and studies on entry mode choice i e the choice between a wholly owned outlet and a subsidiary with shared ownership we arrive at a conceptual synthesis for an examination of the effects of the same predictors on the dual entry establishment mode choice made in the context of a single foreign investment we demonstrate that a parent firm s technological intensity international strategy and experience determine both establishment and entry mode choices moreover we apply williamson s new institutional economics to investigate the influence of institution building on multinational enterprises dual investment choice in the context of transition economies we test empirically the possible moderating effect of a host country s institutional environment we conclude that the degree of the host country s institutional advancement moderates the effect of both technological intensity and international strategy on the establishment and entry mode choice

ownership based entry mode strategies and international performance this study examines the relationship between ownership entry modes and performance the ownership entry modes examined are the wholly owned modes of acquisition and new venture entry and the non wholly owned mode of joint venture entry a theoretical relationship is developed for international entry modes that is based on the contingency characteristics of resource requirements and organizational control factors this model suggests that different entry modes have different performance outcomes based upon their resource and organizational control demands the theoretical model although developed using the eclectic theoretical approach is based largely on concepts and relationships previously delineated in contingency theory our hypotheses suggest that new ventures should outperform joint ventures and joint ventures should outperform acquisitions an empirical test using a sample of 321 japanese firms entering the north american market provides supporting evidence

acquisition or greenfield start up institutional cultural and transaction cost influences in this paper we develop and test a model of diversification mode choice how firms decide between acquisitions and greenfield start up ventures which includes institutional cultural and transaction cost variables using a sample of japanese firms entering western europe our results show the model correctly predicts over eighty seven percent of the mode choices thus we provide strong initial evidence to support using institutional cultural and transaction cost variables to predict firms choices between acquisitions and greenfield start ups in international expansion our findings also suggest that organizations which have developed strong intangible capabilities may be able to more readily leverage these capabilities through greenfield start ups copyright 2000 john wiley sons ltd

developing acquired foreign subsidiaries the experience of mnes in transition economies drawing on subsidiary evolution and dynamic capabilities research i test how development and growth of subsidiaries recently acquired in transition economies are affected by multinational enterprise mne and target capabilities these subsidiaries often lack important resources their cross border transfer enhancement and exploitation are problematic however data on 170 acquisitions in central and eastern europe confirmed the importance of the pre acquisition experiences of both target and mne for subsidiary growth although cultural differences moderated the predicted effects notably

down with mne centric theories market entry and expansion as the bundling of mne and local assets both anderson and gatignon and the uppsala internationalization model see the initial mode of foreign market entry and subsequent modes of operation as unilaterally determined by multinational enterprises mnes arbitraging control and risk and increasing their commitment as they gain experience in the target market oli and internalization models do recognize that foreign market entry requires the bundling of mne and complementary local assets which they call location or country specific advantages but implicitly assume that those assets are freely accessible to mnes in contrast to both of these mne centric views i explicitly consider the transactional characteristics of complementary local assets and model foreign market entry as the optimal assignment of equity between their owners and mnes by looking at the relative efficiency of the different markets in which mne and complementary local assets are traded and at how these two categories of assets match i am able to predict whether equity will be held by mnes or by local firms or shared between them and whether mnes will enter through greenfields brownfields or acquisitions the bundling model i propose has interesting implications for the evolution of the mne footprint in host countries and for the reasons behind the emergence of dragon mnes

history friendly models of industry evolution the computer industry the model presented in this paper is the first of a new generation of evolutionary economic models history friendly models history friendly models are formal models that aim to capture in stylized form qualitative and appreciative theories about the mechanisms and factors affecting industry evolution technological advance and institutional change put forth by empirical scholars of industrial economics technological change business organization and strategy and other social scientists in this paper we have analyzed the long term evolution of the computer industry in particular we have examined the emergence of a dominant firm in mainframes the introduction of a major innovation microprocessor the opening up of a new market segment personal computers ad the competition there between newcomers and diversified old established firms we have taken a body of verbal appreciative theorizing developed a formal representation of that theory and found that the formal version of that theory is consistent and capable of generating the stylized facts the appreciative theory purports to explain going through this analytic exercise has significantly sharpened our theoretical understanding of the key factors behind salient aspects of the evolution of the computer industry copyright 1999 by oxford university press

foreign entry cultural barriers and learning this paper examines the longevity of foreign entries hypotheses are developed on the mode start ups vs acquisitions and ownership structure wholly owned vs joint ventures in relation to cultural distance the hypotheses are tested within a framework of organizational learning using data on 225 entries that 13 dutch firms carried out from 1966 onwards results show that the presence of cultural barriers punctuates an organization s learning cultural distance is a prominent factor in foreign entry whenever this involves another firm requiring the firm to engage in double layered acculturation we also identify locational paths of learning the longevity of acquisitions is positively influenced by prior entries of the firm in the same country similarly the longevity of foreign entries in which the firm has a majority stake improves whenever the expanding firm engaged in prior entries in the same country and in other countries in the same cultural block

user industry spinouts downstream industry knowledge as a source of new firm entry and survival recent scholarship on entrepreneurship suggests that the pre entry know how of start ups embodied in their founders affects not only entry but also performance although prior work focuses on new entrants from the focal industry i e employee spinouts and academic organizations i e university spinoffs this study identifies and examines a hybrid category of start ups from downstream user industries which we call user industry spinouts we draw from the literature on evolutionary theory user innovation and industrial dynamics to propose that given the unique combination of knowledge inherited by these entrants their choices at entry and their ability to survive in the focal industry will differ with respect to other start ups we do this by extending existing work on new firm creation to investigate entry and performance in different product markets our findings based on a dataset of start ups in the semiconductor industry over a 10 year period 1997 2007 show that user industry spinou

founder backgrounds and the evolution of firm size to what extent are firm size differences influenced by entrepreneurs pre founding experience and do these differences persist over time we analyze these questions using a novel data set assembled for australian and new zealand wine producers on their heritage and sizes at various ages our findings indicate that on average firms founded by individuals with prior wine industry experience are larger initially and remain larger for at least the next 20 years using additional data on professional backgrounds export scope and the size of the firms at which experienced founders previously worked we explore alternative mechanisms that could have generated these persistent size differences copyright 2011 the author 2011 published by oxford university press on behalf of associazione icc all rights reserved oxford university press

intrahousehold allocation of free and purchased mosquito nets for some health goods intrahousehold allocation may be more important in determining outcomes than household level consumption an example is the use of mosquito nets to prevent malaria malaria kills over one million people annually 90 percent of them children under the age of five the use of insecticide treated mosquito nets itns is considered the most costeffective available strategy for control of the disease in 2000 44 of the 50 malaria affected countries in africa committed themselves to increasing the use of itns by vulnerable populations in particular children under five years of age and pregnant women adults in malarious regions have typically acquired some immunity to the disease through repeated exposure over the course of their lives the risk of severe malaria resulting in lifelong disability or death is highest for young children and pregnant women across transmission environments robert w snow et al 2003 on the other hand lost labor time often accounts for the largest portion of the private cost of the disease this implies a trade off between minimizing the income lost to malaria and minimizing the risk that a household member dies or is permanently disabled despite public health messages emphasizing the importance of using mosquito nets to protect young children from malaria nets are often used by adults when a household does not have enough nets to cover all members eline l korenromp et al 2003 frederick mugisha and jacqueline arinaitwe 2003 determining the welfare maximizing allocation of nets is intrahousehold allocation of free and purchased mosquito nets

technological regimes and schumpeterian patterns of innovation this paper proposes that the specific pattern of innovative activities in an industry can be explained as the outcome of different technological learning regimes a technological regime is defined by the particular combination of technological opportunities appropriability of innovations cumulativeness of technical advances and properties of the knowledge base building upon the distinction between schumpeter mark i and schumpeter mark ii industries this paper provides empirical estimates of the relationships between indicators of the schumpeterian patterns of innovation concentration of innovative activities stability in the hierarchy of innovators and importance of new innovators and indicators of the variables defining technological regimes

distinction between intermediate and finished products in intra firm trade abstract although intra firm trade has been viewed as associated with vertical integration which exploits opportunities for exchange between inherently dissimilar economies it is more common between developed countries where horizontal integration is expected to dominate using unique data from 1974 to 1990 on swedish firms application of a tobit model explains variations in majority owned manufacturing affiliates internal imports of intermediate and finished goods on the basis of firms international organization of production effects which are unobservable in aggregate figures show up only when finished and intermediate goods are separated

is success hereditary evidence on the performance of spawned ventures a common phenomenon in entrepreneurship is that employees turn away from employment to found their own businesses prior literature discusses the former employers characteristics that influence the creation of entrepreneurial ventures an investigation of whether these characteristics also affect the success of the spawned ventures is missing so far this paper contributes to the literature by showing that entrepreneurial ventures spawned by well performing firms are financially more successful than ventures stemming from poorly performing firms this suggests that spawned entrepreneurs are able to exploit valuable knowledge from their previous employers which impacts their ventures performance positively the analysis is based on a linked employee employer data set for the netherlands for the period 1999 2004

speciation through entrepreneurial spin off the acorn arm story abstract can the concept of speciation explain evidence on how technologies branch and advance can evidence on innovation through spin off usefully inform the concept of speciation these questions are addressed through a case study of detailed processes enabling the shift of technology to new domains of application an innovative it firm developed its own semiconductor technology to remedy supplier deficiencies but it required a joint venture with a completely new business model to adapt and move the technology into new market domains we propose the concept of techno organizational speciation to delineate this phenomenon competing perspectives on speciation compatibility niche and lineage approaches are found to illuminate the evidence while complementarities between these conceptual dimensions are revealed by the case causal processes uncovered include the following 1 techno organizational speciation through spin off may be needed to launch a dominant technical standard compatible with multiple applications 2 this can be achieved through niche creation from which develops a new business ecosystem 3 inherited knowledge together with organizationally based learning foster the branching and renewal of technological lineages

analyzing foreign market entry strategies extending the internalization approach a new fully integrated analysis of the foreign market entry decision is presented encompassing the choice between exporting licensing joint venturing and wholly owned foreign investment the choice between acquisition and greenfield investment is examined and so too are options based on subcontracting and franchising the model extends the insights of internalization theory and draws on concepts from the economics of industrial organization a special feature of the model is the distinction between investment in production facilities and investment in distribution facilities an important practical distinction that has been overlooked in much of the international business literature the strength of competition from indigenous rivals is emphasized as a determinant of entry strategy into both production and distribution

when do spinouts enhance parent firm performance evidence from the u s automobile industry 1890 1986 spinouts entrepreneurial ventures founded by ex employees of incumbent firms within the same industry have emerged in numerous industries some existing literature argues that they typically have a negative association with their parents performance because of the loss of human capital the disruption of organizational routines and subsequent adverse competitive effects more recent work however suggests that such negative effects may have been overstated and argues that there are conditions under which spinouts may be linked to enhanced performance of the parent i contribute to this literature by theorizing about and empirically testing for such conditions in particular using data from the u s automobile industry spanning 1890 to 1986 i find evidence that spinouts are associated with enhanced parent performance when they increase the parent s corporate coherence either through a the core competencies and capabilities domain by refocusing the parent s resources on the core or b the cognitive path by resolving a conflict at the top level of the parent s hierarchy i discuss implications for both research and practice

demand heterogeneity and technology evolution implications for product and process innovation the evolution of technology has been a central issue in the strategy and organizations literature however the focus of much of this work has been on what is essentially the supply side of technical change the evolution of firm capabilities we present a demand based view of technology evolution that is focused on the interaction between technology development and the demand environment in which the technology is ultimately evaluated we develop a formal computer simulation model that explicitly considers the influence of heterogeneity in market demand the presence of consumers with different needs and requirements on firms innovation choices the model is used to examine the dynamics of product and process innovation utterback and abernathy 1975 the analysis reveals that demand heterogeneity offers an alternative to supply side explanations of the technology life cycle further by considering the implications of decreasing marginal utility from performance improvements the model highlights the role of technologically satisfied consumers in shaping innovation incentives and suggests a rationale for a new stage in the technology life cycle characterized by increasing performance at a stable price the stage has not yet been treated formally in the literature but is widely observed most prominently in digital and information based technologies

probing theoretically into central and eastern europe transactions resources and institutions since the 1990s central and eastern europe cee has provided unique societal quasi experiments which represent opportunities to test the applicability of existing theories in international business and management studies and to develop new ones specifically three lines of theorising have been advanced 1 organisational economics theories 2 resource based theories and 3 institutional theories for each of these theories we discuss how they contribute to the understanding of key issues such as entry strategies of foreign investors restructuring strategies of local incumbents and entry and growth strategies of entrepreneurs on this basis we assess how cee research has influenced the overall trajectories of theory development cee research has in particular highlighted the importance of contextual influences such as institutions thus scholars have aimed at incorporating institutions into theories such as organisational economics theories and resource based theories and advancing an institution based view of business strategy as a complementary perspective we outline how future research in cee and other emerging economies may advance this research agenda further

global strategy and multinationals entry mode choice this paper makes a case directed towards establishing the importance of global strategic considerations in choosing multinationals entry mode specifically it is our contention that beyond the environmental and transaction specific factors well established in the literature to affect the entry mode decision we should also consider the strategic relationship a multinational envisages between its operations across borders in reaching this decision after incorporating various global strategic variables into an eclectic framework of the factors influencing the entry mode choice this paper tests both the validity of the overall framework and the importance of each entry mode determinant in differ entiating among entry modes this is done based on ninety six multinational managers responses to a survey questionnaire concerning their entry mode decision experiences the results suggest that an express incorporation of global strategic variables into an analysis of the entry mode decision is warranted

can higher prices stimulate product use evidence from a field experiment in zambia the controversy over how much to charge for health products in the developing world rests in part on whether higher prices can increase use either by targeting distribution to high use households a screening effect or by stimulating use psychologically through a sunk cost effect we develop a methodology for separating these two effects we implement the methodology in a field experiment in zambia using door to door marketing of a home water purification solution we find evidence of economically important screening effects by contrast we find no consistent evidence of sunk cost effects jel c93 d12 i11 m31 o12

the stability of joint ventures reciprocity and competitive rivalry the focus of the following empirical analysis is the influence of reciprocity and long term relationships on the stability of joint ventures these cooperative incentives are offset by industry structural conditions which may promote competitive rivalry among the partners to separate these effects on joint venture survival the hypothesized relationships are proxied by variables drawn from industry and questionnaire data and estimated under a hazard model specification a theoretical implication of the findings is to suggest a shift of attention from the transaction to the economic relationship as the unit of analysis copyright 1989 by blackwell publishing ltd

foreign market entry strategies and post entry growth acquisitions vs greenfield investments we examine the relationship between the foreign market entry strategy and the subsequent growth of a subsidiary we build upon the penrose theory of firm growth and on the organizational economics international management and foreign market entry strategy literatures we hypothesize that the post entry growth of acquisitions is positively associated with weak and codifiable interdependence within the multinational enterprise network whereas the post entry growth of greenfield investments is positively related to strong and complex interdependence empirical findings from a sample of japanese subsidiaries in the us lend support to our argument

internationalising in small incremental or larger steps we argue that companies may enter foreign environments either incrementally as suggested by long established theory or by taking larger steps that may result in lower initial performance but through learning and experience lead to increased performance in future expansions this idea is corroborated by the experience of dutch companies entering into central and eastern europe we also find that expansion steps may be too large thereby limiting the exploration of foreign environments our study suggests that sequential internationalisation strategies do still matter and that companies have to balance exploitation and exploration in internationalisation

employee spinoffs and other entrants stylized facts from brazil using a comprehensive linked employer employee database from brazil for the period 1995 2001 we are able for the first time to compare firms founded as employee spinoffs to new firms without parents and to diversification ventures of existing firms entering a new industry employee spinoffs are defined either as the director manager having moved from a parent in the same industry or as one quarter of the employees having shifted from a common parent depending on definition employee spinoffs account for between one sixth and one third of the new firms in brazil s private sector during this period regardless of definition size at entry is larger for employee spinoffs than for new firms without parents but smaller than for diversification ventures of existing firms similarly exit rates for employee spinoffs are less than for new firms without parents and comparable to those for diversification ventures of existing firms these results suggest that we can think of some part of a firm s productivity draw in the jovanovic 1982 model as embodied in the firm s employees and portable by them to a new firm

firm spin offs in denmark 1981 2000 patterns of entry and exit abstract this paper adds large sample evidence on the extent to which the likelihood of business failure or success is related to relationships between parent firms and their off spring for this purpose we make use of an exhaustive matched employer employee data set covering the entire danish private sector in years 1981 to 2000 to study firm entry and exit special focus is on spin offs a particular group of small entrants which are founded by groups of persons originating from the same former workplace we estimate a multinomial logit model in order to examine which characteristics of the founders and the parent firms increase the probability of spinning off next we carry out a duration analysis of the subsequent transitions of the spin offs and compare their exit risks with those of other entrant firms which have less strong parent progeny relationships in terms of worker flows

the ownership structure contingency in the sequential international entry mode decision process family owners and institutional investors in family dominant versus family influenced firms extending our understanding of family firms and international business research with respect to entry mode decisions this study explains how entry mode choice is the product of a sequential decision making process with an important ownership structure contingency we propose that firms with a dominant family owner family dominant firms prefer low equity ownership as their entry mode for the purpose of preserving their socioemotional wealth their preference is persistent even when the institutional investors are the dominant shareholders in the firm family influenced firms this nuanced examination of the role family values play in the entry mode decision extends our understanding of how family firms enter international markets

the effect of national culture on the choice of entry mode characteristics of national cultures have frequently been claimed to influence the selection of entry modes this article investigates this claim by developing a theoretical argument for why culture should influence the choice of entry two hypotheses are derived which relate culture to entry mode choice one focusing on the cultural distance between countries the other on attitudes towards uncertainty avoidance using a multinomial logit model and controlling for other effects the hypotheses are tested by analysing data on 228 entries into the united states market by acquisition wholly owned greenfield and joint venture empirical support for the effect of national culture on entry choice is found

the spatial evolution of the british automobile industry does location matter this article aims to describe and explain the spatial evolution of the automobile sector in great britain from an evolutionary perspective this analysis is based on a unique database of all entries and exits in this sector during the period 1895 1968 collected by the authors cox regressions show that spinoff dynamics agglomeration economies and time of entry have had a significant effect on the survival rate of automobile firms during the period 1895 1968

disagreements spinoffs and the evolution of detroit as the capital of the u s automobile industry the agglomeration of the automobile industry around detroit michigan is explained using a theory in which disagreements lead employees of incumbent firms to found spinoffs in the same industry predictions of the theory concerning entry and firm survival are tested using data on the origin location and years of production of every entrant into the industry from 1895 to 1966 the geographic concentration of the industry is attributed to four early successful entrants and the many successful spinoffs they spawned in the detroit area and not to conventional agglomeration economies benefiting co located firms as featured in modern theories of agglomeration implications of the findings regarding firm strategy are discussed

mode size and location of foreign direct investments and industry markups abstract several studies find that inward foreign direct investment fdi raises host industries competition and productivity using aggregate fdi measures the monetary flows or the change in the industries foreign production share yet fdi flows are composed of many individual heterogeneous investments reflecting this heterogeneity i ask how the average traits of the individual investments that constitute the fdi flow further affect the host while the results show that inward fdi does heighten competition for us manufacturing industries in 1987 1991 price cost markups fall even more when foreign investments locate further away from incumbent industry which is consistent with endogenous location choice

ownership patterns of u s joint ventures abroad and the liberalization of foreign government regulations in the 1980s evidence from the benchmark surveys data from the benchmark surveys of the commerce department show the beginning of a global liberalization in government restrictions on foreign equity in the 1980s this was manifested in a small but unmistakable across the board reduction in the share of 50 50 and minority affiliates out of all u s affiliates in a country across countries there remains a huge variation in this proportion and the second part of the paper seeks to statistically explain this variation in a cross sectional regression analysis

new ventures or acquisitions the choice of swedish multinational enterprises this study examines the factors influencing the multinational enterprises choice between the takeover of already existing firms and investments in new ventures as a means of entering a foreign market the results suggest that the degree of industrial diversification of the parent company and the host country s per capita income seems to have a positive influience on the propensity for takeovers this propensity appears to be negatively related to the rate of growth of industrial production in the industry entered further we found that the more recent the entry into a foreign market the greater the probability for choosing acquisition

micro loans insecticide treated bednets and malaria evidence from a randomized controlled trial in orissa india we describe findings from the first large scale cluster randomized controlled trial in a developing country that evaluates the uptake of a health protecting technology insecticide treated bednets itns through micro consumer loans as compared to free distribution and control conditions despite a relatively high price 52 percent of sample households purchased itns highlighting the role of liquidity constraints in explaining earlier low adoption rates we find mixed evidence of improvements in malaria indices we interpret the results and their implications within the debate about cost sharing sustainability and liquidity constraints in public health initiatives in developing countries

generational technological change effects of innovation and local rivalry on performance we tested the effects of innovation and market complexity on firm performance generational technological change a major advance within a technology regime fosters the emergence of niches and local

equity joint ventures and the theory of the multinational enterprise this paper extends the internalization approach to the theory of the multinational enterprise mne to include an expanded role for equity joint ventures using the transaction cost paradigm of williamson this paper explains why joint ventures may sometimes be preferred over wholly owned subsidiaries also presented is empirical work on joint venture performance in developing countries which demonstrates that under certain conditions joint ventures can be the optimal mode of foreign direct investment

measuring performance of international joint ventures international joint ventures ijvs are increasing in frequency and strategic importance however efforts to identify variables associated with ijv performance have been constrained by disagreements regarding the comparability and reliability of alternative performance measures and methods this study tests several hypotheses regarding the reliability and comparability of a range of objective and subjective measures of ijv performance as well as evaluating the relative utility of different data collection approaches

a good riddance spin offs and the technological performance of parent firms how do spin offs new ventures created by former employees of an incumbent firm affect the technological performance of their parents conventional wisdom holds that spin offs hurt parent firms the parent loses key staff routines are disrupted and performance declines although having some basis in fact we think the negative effects are overstated we argue that spin offs can enable parent firms to realign with their environment thereby avoiding the oncoming obsolescence arising from the combination of organizational inertia and environmental drift using data from the hard disk drive industry we find evidence that although the main effect of having a spin off on a parent firm s technological performance is positive the overall impact of a spin off depends upon the technological sophistication of the spin off and the time since the spin off occurred indeed parent firms of technologically sophisticated successful spin offs initially suffer poorer technological performance but over time they outperform firms that had no spin offs both effects are amplified to the extent that the spin off is more successful which we attribute to both increased environmental realignment and the positive signal that successful spin offs transmit to the broader labor market about the parent organization s reputation as an incubator of entrepreneurs and a desirable place to work

market seeking mnes in an emerging market how parent subsidiary links shape overseas success this study extends research on parent subsidiary links applying new theoretical perspectives those of resource dependence and dynamic capability to the new empirical setting of an emerging market we suggest that parent subsidiary links help to mitigate emerging market threats by reducing external dependence and help to capitalize on emerging market opportunities by enhancing local responsiveness

sustainable and integrated bioenergy assessment for latin america caribbean and africa sibyl lacaf the path from feasibility to acceptability abstract uncertainties in evaluating bioenergy projects have lead policymakers to adopt a restrictive approach or even refuse to evaluate projects when the available information is limited or a clear perception of its benefits and impact is lacking indeed despite its potential advantages a bioenergy system poses several conceptual and operational challenges for academic as well as practical scrutiny because the inherent relationship and the intersection of areas related to energy production and agricultural activity requires a deeply integrated assessment the aim of this paper is to review the available works in this field and propose an approach for supporting policymakers in the taking decision process of deploying sustainable bioenergy systems the sibyl lacaf framework provides a comprehensive framework for addressing the inherent complexity of the subject and its sustainability and acceptability as part of the evaluation process with this approach different and complementary evaluation methods are reviewed and set in a logical and sequential structure to draw a group of indicators used for assessing a given project with the help of a strengths weaknesses opportunities and threats swot matrix when acceptability is identified as an issue a public consultation and communication pc c scheme can complement this process the suggested application for mozambique indicate that an acceptable outcome is possible even when considering the data requirements and constraints of developing countries thus the potential of this integrated approach outweighs such limitations

free distribution or cost sharing evidence from a randomized malaria prevention experiment author s cohen jessica dupas pascaline abstract it is often argued that cost sharing charging a subsidized positive price for a health product is necessary to avoid wasting resources on those who will not use or do not need the product we explore this argument through a field experiment in kenya in which we randomized the price at which prenatal clinics could sell long lasting anti malarial insecticide treated nets itns to pregnant women we find no evidence that costsharing reduces wastage on those that will not use the product women who received free itns are not less likely to use them than those who paid subsidized positive prices we also find no evidence that costsharing induces selection of women who need the net more those who pay higher prices appear no sicker than the average prenatal client in the area in terms of measured anemia an important indicator of malaria cost sharing does however considerably dampen demand we find that uptake drops by 75 percent when the price of itns increases from zero to 0 75 i e from 100 to 87 5 percent subsidy the price at which itns are currently sold to pregnant women in kenya we combine our estimates in a cost effectiveness analysis of itn prices on child mortality that incorporates both private and social returns to itn usage overall our results suggest that free distribution of itns could save many more lives than cost sharing programs have achieved so far and given the large positive externality associated with widespread usage of itns it would likely do so at a lesser cost per life saved

brownfield entry in emerging markets this paper focuses on the brown field entry mode as a special case of acquisition in which the resources transferred by the investor dominate over those provided by the acquired firm we see this mode as having particular relevance for entry strategies in emerging markets the choice of entry mode is analyzed on the basis of a framework utilizing both resource based and transaction cost theories the resource requirements have to be matched with resources available to the investor through an acquired firm and the decision has to account for the costs of acquiring and integrating the resources

entry modes for direct investment determined by the composition of firm specific skills when undertaking direct investment in a foreign country a firm can choose between different modes of entry broadly speaking an investor may either acquire an existing firm or set up a new venture i e perform a greenfield investment the mainstream perspective on this choice stipulates that takeovers are less risky than greenfield investments but yield a lower expected rate of return cf caves 1982 consequently a firm would become more willing to perform greenfield investments as greater capabilities and international experience increase its ability to handle risks according to dubin 1976 and stopford 1976 firms with a large and geographically diversified portfolio of already established subsidiaries have a greater propensity to undertake greenfield investment the greater a firm s diversification in terms of industries and the faster its growth indicating less knowledge and experience per unit of activity the greater the propensity to use takeovers in the last decades however there has been a marked tendency towards more takeovers and less greenfield investments see un 1992 this is hardly consistent with the conventional view as the bulk of direct investment is established by a relatively small number of multinational corporations which continuously upgrade their experience and capabilities rather the riskiness as well as expected profitability of alternative modes of entry depend on the nature of skills and capabilities this analysis distinguishes between organizational and managerial skill on the one hand and skill which is related to specific technology on the other com

latent submarket dynamics and industry evolution lessons from the us laser industry in its first 35 years the us laser industry was characterized by steady growth in output and the number of producers whereas subsequently the number of producers steadily declined despite continued growth in the industry s output a model of industry evolution that features the creation destruction and fusing of independent submarkets is developed to explain these two eras data on all laser producers are used to test various implications of the model concerning entry exit and innovation the findings suggest that the emergence of an integrative submarket can fundamentally alter an industry s market structure and the character of innovation which is applied to explain historical developments in the evolution of various innovative industries

firm ownership preferences and host government restrictions an integrated approach two approaches may explain how multinational enterprises mnes select ownership structures for subsidiaries the first argues that mnes prefer structures that minimize that transaction costs of doing business abroad the second argues that ownership structures are determined by negotiations with host governments whose outcomes depend on the bargaining power of the firm this paper presents a framework integrating these two approaches and uses statistical methods to separate their effects empirically

impact of off farm income on household energy expenditures in china implications for rural energy transition abstract this study examines the impact of off farm income on rural household energy expenditures paying special attention to clean energies such as electricity and gas and non clean energy such as coal we use instrumental variable approaches to address the endogeneity issues of off farm income and analyze household survey data collected from rural gansu henan and shandong provinces of china econometric results show that off farm income promotes rural energy transition in particular off farm income significantly increases both electricity and gas expenditures but decreases coal expenditure of rural households further analyses reveal that the energy transition effects generated by off farm income are more pronounced for households in shandong where the economy is relatively better developed relative to henan and gansu our findings highlight the importance of income diversification through off farm activities by farm households to enhance clean energy accessibility and boost sustainable rural economic development

institutions transaction costs and entry mode choice in eastern europe the process of change from a centrally planned system to a market economy generates an institutional framework that is only partially reformed and therefore inconsistent and unstable this leads to high transaction costs for economic agents multinational enterprises entering transition countries have to adapt their strategies to the local institutions and reduce exposure to highly imperfect markets this paper analyzes how the costs of organizing business in transition environments influence entry mode choice the empirical results show that host country institutions in transition economies have an impact on the choice of entry modes moreover different mechanisms determine the internalization of managerial and technological knowledge

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

spinoffs and the ascension of silicon valley this article analyzes firm entry and performance in the semiconductor industry from the introduction of the integrated circuit ic in 1965 until 1987 during this period the industry which was initially concentrated on the east coast of the united states became increasingly clustered in silicon valley sv california this location shift was accompanied by a change in the technology used to produce semiconductor devices by studying how diversifiers and new firms enter into ic production and the technology they choose to produce ics we document the process of growth of sv in particular we analyze how agglomeration economies as well as the heritage of new firms founders affect the opportunities pursued by entrants and their long term likelihood of success we find that ic entrants in sv were more likely to enter at the technological frontier than ic entrants in other clusters however we find no evidence suggesting that being located in a cluster helped existing ic producers that were not initially at the technological frontier to catch up with the rest of the industry examining long term performance we find that firms that become top producers are disproportionately spinoffs of leading firms or diversifiers with a transistor background while most of these firms were located in sv after controlling for heritage and background location has no significance on the likelihood of becoming a top producer

does purchase price matter for the waiting time to start using energy efficient technologies experimental evidence from rural ethiopia abstract in this study we conducted a randomized experiment in rural ethiopia to test on how quickly energy efficient technology an improved stove is put in use after the technologies is disseminated we evaluate two concepts that may affect usage of a product screening related to valuation of a product and sunk cost effects based on the price the potential user paid for the product a standard tobit and iv tobit methods of estimations are used for testing sunk cost and screening effects respectively results based on the baseline survey and follow up data shows that there is no difference in the length of waiting time to start using the energy efficient technology between those who got the stove for free and those that paid money for it in other words the sunk cost effect is absent however we find a difference in the waiting time between those with high valuation for the stove and those with lower valuation for it in other words we find an evidence of the screening effect the result has pricing policy implications for government and non government organizations involved in dissemination of such technologies that have both public environmental and private benefits

us companies in transition economies wealth effects from expansion between 1987 and 1999 this study uses a unique sample to evaluate changes in shareholder wealth from announcements of expansion by us firms into 18 transition economies through four entry modes from 1987 to 1999 on average expansion in transition economies is associated with significant positive wealth effects results show that value creation is most significantly associated with expansion through less risky entry modes into host countries that are in the more advanced stages of market liberalization and structural reform sample firms with lower profitability also experience significantly higher abnormal returns while significant value creation documented for firms entering transition economies in 1989 1990 and 1992 suggests first mover advantages

do multinationals really prefer to enter culturally distant countries through greenfields rather than through acquisitions the role of parent experience and subsidiary autonomy prior research has argued that multinational enterprises mnes prefer to enter culturally distant countries through greenfields rather than through acquisitions since acquisitions in such countries are costlier to manage this argument contains two hidden assumptions 1 the additional costs of acquisitions in culturally distant countries are the same for all mnes and 2 such acquisitions have no benefits over their greenfield counterparts in this paper we relax these two assumptions by arguing that an mne s preference for greenfields in culturally distant countries depends on its international and host country experience and on the level of autonomy it plans to grant the focal subsidiary analyzing 171 wholly owned greenfield investments and full acquisitions made by dutch mnes in 35 countries we find that these mnes prefer to enter culturally distant countries through greenfields but that this preference is lower when they have little international experience or plan to grant the focal subsidiary considerable autonomy in marketing

an economic model of international joint venture strategy the strategic choice between joint ventures licensing agreements and mergers is analysed using eight key factors suggested by internalisation theory the model explains the increasing role of international joint ventures in the 1980s in terms of the accelerating pace of technological innovation and the globalisation of markets it offers a range of predictions about the formation of joint ventures within industries across industries across locations and over time it exploits a powerful modelling technique that has many other applications in international business strategy

theoretical foundations of emerging economy business research in probing theoretically into central and eastern europe transactions resources and institutions we outlined the contributions of research in central and eastern europe cee to theoretical debates in business research in this retrospective we reflect upon the evolution of the field over the past decade with the fading impact of cee s distinct shared history we suggest that cee best be analyzed as emerging economies rather than as a distinct geographic entity emerging economy business research is converging on common themes and shared theoretical ideas while identifying critical variations that constrain generalizations among and beyond emerging economies this research thus highlights the need to develop a better understanding of the boundary conditions of scholarly theories of business knowledge over the past decade the institution based view has emerged from distinct intellectual traditions in institutional economics organizational theory and the analysis of business government bargaining research in these converging lines of theorizing places contextual variations at the center of explanations of business phenomena around the world we suggest that the institution based view is evolving toward a paradigm and offer suggestions on how to advance this research agenda further in particular by exploring how firms engage with different sets of potentially conflicting institutions at multiple levels and locations