more shock than therapy market transition employment and income in russia 1991 1995 sixteen predictions from market transition theory are assessed using survey data on employment earnings and income in russia during the first five years of market reform although the private sector has grown self employment is still rare incomes are down and unemployment is up a distended income distribution reflects unprecedented income inequality distinctive features of late soviet era stratification persist low returns to education a gender gap in earnings and low earnings among professionals the russian market transition offers more opportunity in trade consumer services and speculation and less in manufacturing than do other emerging makets this corresponds to merchat capitalism and contradicts the predictions of market transition theory everything the communists told us about communism was a lie everything they told us about capitalism turns out to be true popular russian joke circa 1996

an overview of hofstede inspired country level culture research in international business since 2006 kirkman lowe gibson s 2006 jibs article summarized and critiqued international business research inspired by the most cited book in the field hofstede s 1980 culture s consequences international differences in work related values hofstede 1980 2001 they identified a number of issues in this research and offered several recommendations for improving it in the future thus laying a strong foundation for hofstede related work since 2006 in this commentary we assess kirkman et al s 2006 impact on the field our review shows that their ideas have informed and inspired their own and other scholars work and have led to significant progress in the way in which hofstede s framework has been used in international business in the last decade here we specifically focus on the country level culture studies and assess how research has implemented kirkman et al s three main recommendations to explore cultural dimensions beyond those introduced by hofstede to distinguish between country effects and cultural effects and to show not only if culture matters but also how much it matters in addition to the overview we provide a comprehensive test of these recommendations showing how they can be put into research practice underscoring the theoretical and empirical relevance of the original 2006 article our commentary concludes with additional ideas on further strengthening hofstede inspired research at the country level of analysis

organizational membership and environmental ethics a comparison of managers in state owned firms collectives private firms and joint ventures in china abstract this study empirically examines the relationship between organizational type and the environmental ethical orientation of managers in the people s republic of china prc on three dimensions stewardship and long and short term utilitarianism it was found that chinese managers uniformly self report strong ethical commitments to environmental protection in addition organizational type was found to be a significant predictor for the different ethical dimensions overall managers in state owned firms uniformly reported the strongest values managers in private firms on the other hand self reported lower values and appeared relatively more skeptical of emergent utilitarian arguments that economic performance and environmental performance are compatible in the short term

chinese villages and townships as industrial corporations ownership governance and market discipline1 public firms in a reforming socialist economy face two problems the old soft budget constraint syndrome and new principal agent problems china s township village government owned enterprises tves outperform state owned enterprises soes in growth rate and productivity three explanations are proposed in the literature 1 tves represent informal or ambiguous private property rights which are most efficient in partial reform 2 the small size and scale of township village governments as industrial corporations allows officials to monitor tves directly and to limit their wherewithal for cross subsidizing 3 strict market disciplines facing tves render indirect market monitoring to mitigate agency problems effectively analyses of jiangyin data show that a while both superior to local soes village and township enterprises share similar productivity and b the scale of township village corporations slightly increases productivity i conclude that local state corporatism should be revised to inc

mass privatization state capacity and economic growth in post communist countries why did the transition from socialism to capitalism result in improved growth in some countries and significant economic decline in others scholars have advanced three main arguments 1 successful countries rapidly implemented neoliberal policies 2 failures were not due to poli cies but to poor institutional environments and 3 policies were counterproductive because they damaged the state we present a state centered theory and empirically demonstrate for the first time one of several possible mechanisms linking neoliberal policies to poor economic performance mass privatization programs where implemented created a massive fiscal shock for post communist governments thereby undermining the development of private sector gover nance institutions and severely exacerbating the transformational recession we performed cross national panel regressions for a sample of 25 post communist countries between 1990 and 2000 and found that mass privatization programs negatively affected economic growth state capacity and property rights protection we further tested these findings with firm level data from a rep resentative survey of managers in 3 550 companies operating in 24 post communist countries within countries that implemented mass privatized programs newly privatized firms were sub stantially less likely to engage in industrial restructuring but considerably more likely to use bar ter and accumulate tax arrears than their state owned counterparts

insider privatization with a tail the screening contract and performance of privatized firms in rural china abstract this paper studies insider privatization in rural china and provides an explanation of why some firms have performed well after privatization but others have not we show theoretically that the underperformance of insider privatized firms could be due to the manager cum owner s lack of incentives after privatization a screening theory predicts that the buyout price is correlated with the postprivatization incentives and a firm s postprivatization performance increases with both the buyout price and postprivatization incentives drawing on data we collected in china we find evidence supporting the theory we also find that the buyout price decreases with the degree of information asymmetry

property rights redistribution entitlement failure and the impoverishment of landless farmers in china within the process of urban expansion through land requisition in china farmers de facto rights to collective land including farmland and housing plots zhaijidi are forcibly acquired by the state and thereafter redistributed to private developers to facilitate urban based economic growth deprived of a secure livelihood some landless farmers become trapped in poverty others find that the property rights restructuring in urbanised villages gives them an opportunity to earn rental income however the opportunities are not equally distributed and the processes are in general stacked against the interests of villagers this paper analyses the impoverishment of farmers caught up in china s relentless urban expansion programme using the perspectives of property rights and entitlements it presents case studies of two villages in xi an to illustrate how farmers entitlement sets and vulnerability to poverty have changed as a result of changes in land rights

economic transformation and income inequality in urban china evidence from panel data using panel data of 4 730 urban residents drawn from 20 cities in china this article examines changes in income determinants between the prereform and reform eras to guide this empirical study a conceptual model is developed that emphasizes the coevolution of politics and markets to synthesize theoretical ideas in the recent debate on the transformation of state socialist societies the findings show significant changes in returns to education and in the rise of private hybrid firms in the reform era there is also strong evidence of institutional persistence in returns to positional power and in the organizational hierarchy these findings reveal multifaceted processes of transformation that call for more sophisticated theoretical models and in depth institutional analyses

between markets and politics organizational responses to reform in china in china s economic transition firms diversify assets through investments in the rapidly expanding service sector in response to organizational uncertainty using data from a random sample of firms in shanghai the author shows that there are two situations that cause this uncertainty economic instability where weak firms struggle to survive in the rapidly changing market system and administrative instability where large firms that were the most protected are now being forced to handle the responsibilities that were previously handled by the state the result is that both types of firm seek stability by spreading out risk through investment in low risk fast return markets revealing much about the economic reforms the overall strategy of a firm reflects at any given point in time important organizational facts any decision to fundamentally alter the deployment of internal resources represents a major structural change these kinds of changes do not occur often when they do they provide us wit

embeddedness and contractual relationships in china s transitional economy interfirm contracts represent common economic relations in the marketplace they are also deeply embedded in social relations and social institutions in the context of china s transitional economy this study examines how three mechanisms economizing transaction costs network based social relations and institutional links affect interfirm contractual relationships in 1 the choice of search channels for contractual partners 2 the formality and provisions in a contract and 3 the intensity of social interaction in contract implementation empirical evidence is drawn from information collected on 877 contracts from 620 firms in two chinese cities beijing and guangzhou the authors find distinct roles of social relations institutional links and regulatory environments in the initiation of contractual partners and the forms of contracts adopted whereas transaction specific factors play a significant role in the intensity of social interaction in contract implementation these findings suggest the interplay among economic calculativeness social networks and institutional links and the complementarity in the underlying theoretical ideas

redefining rural collectives in china land conversion and the emergence of rural shareholding co operatives as land conversion has led inevitably to socioeconomic dislocations in china a variety of bottom up reforms have been designed to mitigate and contain the resultant conflicts this evolves the cre

intra cultural variation evidence and implications for international business this paper discusses the methodological and theoretical significance of intra cultural variation icv the population distribution of a characteristic within a culture a monte carlo study shows that icv has substantial influence on the statistical power of cross cultural tests therefore studying icv is methodologically important if we are to understand inconsistent findings and design cross cultural studies with enough statistical power moreover an examination of the cultural means and icvs of 42 cultures shows that icv is as large as the variation of cultural means across cultures and its relationship to cultural means is not definite a model based on multiple disciplines is proposed to cast icv in a nomological net and to illuminate several avenues for future research practical implications are also discussed

institutional environment public private hybrid forms and entrepreneurial reinvestment in a transition economy abstract many less developed and especially transition economies have had high levels of entrepreneurial reinvestment for relatively long periods despite the absence of developed government institutions to resolve this puzzle this study proposes that many entrepreneurial firms in these economies have been actively engaged in political activities through which organizational arrangements are created to co opt government agencies into their organizational structures to manipulate and even control unfavorable institutional environments it empirically evaluates the role of one such organizational arrangement public private hybrid forms in china s gradual reform period it suggests that through protecting property rights and facilitating access to key resources and opportunities public private hybrid forms may act as a substitute for deficient market and legal institutions thus facilitating entrepreneurial reinvestment the findings from a national sample of chinese entrepreneurial firms support our propositions in general entrepreneurial firms adopting public private hybrid forms enjoy higher entrepreneurial reinvestment rates than pure private firms during gradual reform and this may be the case because such forms help to both protect private property rights and access key resources and opportunities in addition the association between the forms and reinvestment rate is found higher under less developed government institutions

institutional forces and organizational culture in china effects on change schemas firm commitment and job satisfaction this paper examines the effects of institutional forces on change schemas of senior managers mid level managers and front line workers of different types of firms in china we postulate that several socio economic forces including regional economic prosperity firm type state owned and foreign invested within firm ranks and organizational cultures are at work the cognitive differences among people in local and foreign firms operating in similar contexts are examined through a survey of 3 960 managers and workers we test hypotheses that relate various institutional forces on how individuals perceive evaluate and infer future changes that challenge them we also examine the effects of individual change schema on firm commitment and job satisfaction two indicators that may mediate future changes in these firms

china s transition and its implications for international business this paper focuses on institutional change as the central and most consequential contextual aspect of china s transition identification of key characteristics of china s emergent institutions leads to propositions on their relevance for international business practice china s transition also raises issues for theory development including the way that transition is modeled the need to draw upon multiple perspectives and the concomitants of a contextual approach

the impact of order and mode of market entry on profitability and market share market share performance and profitability of overseas business activities has long been an important issue in international business in this study we explore the impact of order and mode of market entry into an overseas market we find that early entrants have significantly higher market shares and profitability than late followers we also find that equity joint ventures have a higher profitability than either wholly owned operations or contractual joint ventures a significant interaction exists between order and mode of market entry as expected firm efficiency and size affect the performance of firms these results are based on the business activities of a sample of 14 466 foreign firms in china in 1995

dynamics of china s provincial level specialization in strategic emerging industries this paper examines the dynamics of technological specialization in strategic emerging industries seis within each of mainland china s 31 provinces and the likely effectiveness based on the experiences of taiwan and south korea of the provinces strategies for developing these industries grounded in economic decentralization theories the empirical method employed includes analyzing the scores on an sei specialization promotion index per each province alongside several analytics of invention patent data from each province in the seven seis newly designated by the central level government as of 2010 the data is quantitatively analyzed according to four groups of indicators based on the following specialization relevant concepts comparative advantages and technological capabilities economy size and income technological uncertainty and lifecycles and latecomer entry into complex technologies where knowledge is most cumulative the analysis finds that china s system of economic decentralization has partially worked to ensure provincial industrial policymaking is effective whereby a notable number of provinces are seemingly pursuing sei development strategies in terms of sei selection and promotion that may enable catch up however paradoxically at the same time the system appears to sometimes facilitate provincial sei development strategies that are quite risky or even likely ineffective

glocal understandings female readers perceptions of the new woman in chinese advertising research in international advertising has often taken a dichotomized approach as exemplified by the global standardization vs localization debate it is assumed under the standardization approach that the globalization process will absorb different national cultures into a global commercial culture such that standardized advertising should be preferred the current research argues that the dichotomization approach may have oversimplified the way consumers read and interpret ad images we postulate that consumers in a transitional economy apply a variety of reading approaches including different cultural interpretive strategies and self referencing to absorb global images into their cultural and consumption schemas this is commonly referred to as glocalization we developed a typology of modern women images in chinese magazine advertising potential interpretive strategies and self referencing responses in this research results of a content analysis and a reader response study support our postulations implications are discussed

adapting to radical change strategy and environment in piece rate adoption during china s transition adaptation to radical change is central to research in organization theory and some of the most dramatic examples of environmental change have occurred recently in transition economies such as china i take advantage of change during china s economic reform to study the relative importance of organizational and environmental factors in producing innovative managerial response i find that strategic choice predicted innovation in the early stages of reform but environmental factors increased in salience over time intrafirm support communist party connections and a market orientation produced innovation early in reform simple imitation of others was also salient in early years as reform progressed managers increasingly imitated other profitable firms and drew on their own experience my results inform an understanding of both the process by which innovation occurs and firm behavior in transition economies

the soviet transition from socialism to capitalism worker control and economic bargaining in the wood industry analyses oftlze transition from state socialisnz to capitalism pically focus on political impedimerlrs and underesritnate tlle economic obsracles to economic rransformatior1 based or1 a c ase srudy c f the soviet o o d indusrr y we argue tlzur there hill he no economic tr ansition so long as enterprises rerain two hisroric features nanzely anarchy in pr oduction and barqainit g in exrernal r elarions far jtom consrituting a re olution tlze witllerirlg away of the party srate has esaggerared rlle parhologies of rhe old econotnic order barrer has hecome nzo1 e inzpor tant conglonzerates ha1 e strengrhened their monopoly and wrkers 1la1 e greater conrr ol of tlze shop floor if there is a nzolbemenr to sar d a nzar ket economy at all it is to sar da jb1 m ofmerchant capitalisnz rlzut deepens economic under de elol nzet t and lz arts tlze rise of nzodern bourgeois capiralism

markets and inequality in transitional economies toward testable theories nee s 1989 and in this issue market transition theory contested by xie and hannum in this issue claims that market mechanisms have predictable implications for inequality compared to nonmarket allocation market exchange enhances the bargaining power of producers nee p 910 the core argument is that cadre advantages shall decline to the extent that markets replace redistribution as the dominant mode of economic allocation while in successive publications nee has altered his judgment about how far the market transition has proceeded in rural china and whether his theory does predict a decline of cadre privilege he has not altered the core claim about market allocation market economies vary widely in their patterns of power and privilege in ways unrelated to the extent to which a market economy has been established the variability of market economies warns against attempts to predict changes in inequality without first specifying the kinds of enterprises and other institutions that characterize the emerging market economy or even the characteristics of markets themselves we have been tempted into these predictions by the memorable polanyian contrast between two ideal typical economies redistributive and market that has proven a rich source of hypotheses about stratification szelenyi 1978 1983 and the theory of the firm kornai 1992 under state socialism this contrast has crystallized a research agenda by posing an important historical question about the social impact of the rise of market allocation in planned economies especially as it concerns the fate of communist officials but many now find that these ideal types and the continuum that bridges them are a poor guide to the analysis of emerging market economies see bian and logan 1996 lin 1995 rona tas 1994 1995 walder 1992 1995 and stark and xie and hannum in this issue general claims about the impact of markets should be viewed skeptically for the impact of markets works through the allocation of assets the characteristics of emerging markets and the political processes by which market economies are established markets per se are not the issue

markets and income inequality in rural china political advantage in an expanding economy when market reform generates rapid growth in an agrarian subsistence economy changes in inequality may be due to economic growth and structural change rather than to the intrinsic features of markets the case of post mao china is examined using nationally representative survey data gathered in 1996 to address unresolved questions about findings from 1980s surveys well into reform s second decade political officeholding has a large net impact on household income comparable to that of operating a private enterprise contrary to findings based on earlier surveys and expectations about the impact of growth cadre household advantages are stable across levels and forms of economic expansion returns to entrepreneurship however decline sharply with the spread of wage employment future declines in relative returns to political position are therefore unlikely to occur due to the further spread of private household entrepreneurship and theories of change based on this mechanism appear untenable

monetary policy and long term interest rates an efficient markets approach abstract this paper is an application of efficient markets theory to analyze empirically the relationship of money supply growth and long term interest rates this approach has the advantage over calier research on this subject in that it imposes a theoretical structure on this relationship that flows easier interpretation of the empirical results as well as more powerful statistical tests on the interest of ascertaining the robustness of the results many different empirical tests are carried out in this paper and they uniformly do not support the preposition that increases in the money supply are correlated with declines in long rates

from privatization to deindustrialization implications of chinese rural industry and the ownership debate revisited summary this paper examines the evolution of chinese rural industry since the rural reform in the late 1970s and revisits the debate on the role of ownership based on a case study of w county in southern jiangsu province as well as drawing on national data the author shows that the community based market dynamic had been a key factor in the expansion of rural enterprises and that its weakening in recent years has led to the closing of village enterprises and deindustrialization of the countryside large scale land expropriation sponsored by local government is the principal factor responsible for the change

the roles and performance of state firms and non state firms in china s economic transition summary it is commonly accepted that state owned enterprises soes are inefficient and that non state firms drive the phenomenal growth in china however why soes are not dying out and how the non state firms thrive in a poor institutional environment remain unanswered we apply the institutional and principal agent perspectives to explain how firms with different ownerships deploy their resources and formulate strategies to achieve their goals using china s industrial census data we find that soes tend to adopt strategies conducive to fulfilling administrative tasks and empire building whereas the non state firms tend to be more profitable in the market policy and strategic implications are discussed

organization and management in the midst of societal transformation the people s republic of china twenty five years of economic reform has propelled china to the center of the world s economic stage based on current trends in the foreseeable future china is likely to become the largest economy in the world china s dramatic growth may be envied by other developing economies but for management scholars it presents an exciting intellectual puzzle in this paper we describe the empirical context of china today review contemporary research on chinese management and organizations and describe the nine papers in this special issue oforganization science the papers provide a close examination of how massive corporate transformation in china has influenced interfirm relationships affected opportunity structures and social processes and modified individual behaviors within firms we identify the many paradoxes in this intellectual terrain and present a guide to the challenging research agenda ahead we recommend that scholars of organizations think deeply about china as a context and consider china as an empirical setting where the boundaries of existing knowledge on organizations can be extended

the decline of township and village enterprises in china s economic transition summary a paradoxical phenomenon in china s transitional economy is that markets developed under predominant public ownership which nevertheless has declined with the development of markets previous studies reveal that initial political and economic conditions of reform and fiscal decentralization gave rise to local public enterprises leading role in early marketization this paper explains the subsequent fall of such a role building and expanding on recent studies of privatization we argue that market development and competition have constrained the abilities of local public enterprises to address revenue and employment imperatives whereas local governments sales oriented growth strategies have exacerbated governance problems panel data are analyzed to provide provisional test of pertinent hypotheses

ownership organization and income inequality market transition in rural vietnam in transitional economies the scale of economic enterprise and the allocation of property rights shape social structures and influence income distribution in agrarian economies where labor intensive family enterprises dominate political officials income advantages decline rapidly relative to those of private entrepreneurs larger enterprises however provide greater income opportunities for officials especially when a government retains an ownership stake in the initial phases of reform this article replicates the findings from an earlier study of rural china using comparable survey data from vietnam we find that during the first two decades of rural market reform in vietnam and china the scale and ownership of firms differed radically small family enterprises dominated rural development in vietnam whereas china s development was dominated by larger firms initially established by rural governments consequently while cadre income advantages have kept pace with those of private entrepreneurs

competition and privatization amidst weak institutions evidence from mongolia mongolia s mass privatization program was implanted in a country that lacked the very basic institutions of capitalism this paper examines the effects of competition and ownership on the efficiency of the newly privatized enterprises using a representative sample of enterprises and controlling for possible selection biases competition has quantitatively large effects perfectly competitive firms having nearly double the efficiency of monopolies enterprises with residual state ownership appear to be more efficient than other enterprises reflecting an environment where the government was pressured to focus on efficiency and institutions gave little voice to outsider owners jel p0 l1 l33 o12

the effects of social capital and organizational innovativeness in different institutional contexts this paper examines how social capital and organizational innovativeness influence business performance through their separate indirect or interactive effects and how these effects differ across the institutional contexts of a transition economy and a market economy in line with institutional theory our findings show that the effects of social capital are more extensive and probably more malignant in a transition economy than in a market economy furthermore different types of organizational innovativeness as corporate culture can be cultivated by different forms of social capital in different institutional contexts the implications for institutional theory and social capital theory and the managerial implications are discussed

does governance cause growth evidence from china this study tests the causal relationships between quality of governance and economic growth at the provincial level in china during the post mao reform era exploiting the wide cross provincial variation and rapid change over time in governance institutions and economic performance in china during this period covering 1985 2005 the study provides a new perspective on the relationship between governance and growth whereas a large body of prior literature has demonstrated a strong positive association between high quality governance institutions and good economic performance at the cross country level few quantitative studies have explicitly tested the direction of causality between changes in governance quality and changes in economic outcomes this study aims to address this gap in the literature by testing two causal hypotheses on the interplay between provincial level governance and economic performance in china i improvements in provincial quality of governance predict subsequent economic growth rates and ii increases in provincial economic growth rates predict subsequent changes in quality of governance using new heterogeneous granger causality tests that allow for potential differences in the causal relations across provinces i show a significant and positive effect of economic growth on subsequent quality of governance largely driven by growth in the secondary sector but no significant effect of quality of governance on economic growth these findings suggest that improvements in formal governance have not been a key factor driving china s rapid growth instead the observed positive association between governance and growth reflects the ability of provincial governments to harness the potential created by economic growth to implement subsequent governance improvements for researchers studying the effect of governance on growth the results suggest that greater attention should be paid to possible reverse causality from economic outcomes to governance changes

reform in eastern europe how can the new governments of eastern europe succeed in moving from centrally planned to freemarket economies this incisive report identifies and describes the major policy choices to be made and discusses what will work and what will not reform in eastern europe provides a comprehensive easily read statement of reform policy that stands in the mainstream of modern western economics based on their experience with stabilization policies in other countries the authors show how eastern europe can reduce unemployment during the painful adjustment process create effective and socially acceptable mechanisms to subject enterprises to market discipline and replace barter trade under cmea with market based international trade

the power of instability unraveling the microfoundations of bargained authoritarianism in china this article develops an interactive and relational conception of infrastructural state power for studying the capacity of authoritarian regimes to absorb popular protests based on an ethnography of the grassroots state in moments of unrest in china the authors identify three microfoundations of chinese authoritarianism protest bargaining legal bureaucratic absorption and patron clientelism adopting respectively the logics of market exchange rule bound games and interpersonal bonds these mechanisms have the effect of depoliticizing social unrest and constitute a lived experience of authoritarian domination as a non zero sum situation totalizing and transparent yet permissive of room for maneuvering and bargaining this heuristic framework calls for bringing the subjective experience of subordination back into the theorizing of state domination

territorial competition in china and the west chien s s and gordon i territorial competition in china and the west regional studies in modern western societies and most other economies to which it has spread territorial economic competition is associated with a combination of competitive electoral politics and private land ownership in mainland china however a very strong form of this competition has emerged without either of these supports in general the development of such local collective action and its particular effects reflect an interaction between materially interested local agents and structural pressures the difference in china is that these agents are principally local government leaders whose career prospects within a still centralized system depend upon performance in terms of economic criteria set from above chien s s et gordon i la competition territoriale en chine et dans l ouest regional studies dans les societes occidentales d aujourd hui et dans la plupart des autres economies auxquelles elle s est etendue la

estimating the performance effects of business groups in emerging markets business groups confederations of legally independent firms are ubiquitous in emerging economies yet very little is known about their effects on the performance of affiliated firms we conceive of business groups as responses to market failures and high transaction costs in doing so we develop hypotheses about the effects of group affiliation on firm profitability affiliation could either boost or depress firm profitability and members of a group are likely to earn rates of return similar to other members of the same group using a unique data set compiled largely from local sources we test for these effects in 14 emerging markets argentina brazil chile india indonesia israel mexico peru the philippines south africa south korea taiwan thailand and turkey we find evidence that business groups indeed affect the broad patterns of economic performance in 12 of the markets we examine group affiliation appears to have as profound an effect on profitability as does industry membership yet strategy scholars have a much clearer grasp of industries than of groups moreover membership in a group raises the profitability of the average group member in several of the markets we examine this runs contrary to the wisdom conventional in advanced economies that unrelated diversification depresses profitability overall our findings suggest that the roots of sustained differences in profitability may vary across institutional contexts conclusions drawn in one context may well not apply to another copyright 2001 john wiley sons ltd

chinese multinationals fast internationalization financial performance advantage in one region disadvantage in another our study reveals the financial performance implications of the speed at which chinese multinational enterprises cmnes expand into intra regional versus inter regional host countries in doing so we propose a framework that integrates internationalization speed and home regionalization literatures using data from 767 publicly listed cmnes from the years 2002 to 2014 we discover that the faster the intra regional internationalization the better the firm s financial performance whereas faster inter regional internationalization demonstrates a poorer financial performance we also find that fast mover cmnes technological and marketing resources are valuable in intra regional host countries but vulnerable in inter regional host countries we discuss the implications of these findings for studies of the uppsala internationalization process model and regional mnes

the effect of money shocks on interest rates in the presence of conditional heteroskedasticity most current empirical work finds no evidence that money shocks lower interest rates we show that these nonresults are mainly due to a failure to model the conditional heteroskedasticity of interest rates autoregressive conditional heteroskedasticity arch models find a significant liquidity effect where ordinary least squares ols models do not the existence of a liquidity effect is found using different models and sample periods when arch models are used in estimation but never when ols is employed

political economy based institutional industry complex and sustainable development the case of the salt chemical industry in huai an china abstract this article explains how the salt chemical industry may evolve over time from a high energy consumption based industry complex in the local community to a consolidated pro growth pluralist regime at the urban scale the salt chemical industry is resisting to restructure to a sustainable environmental friendly economic system by spilling over in the form of pro growth political economic coalition in local society theories of the logan and molotch s growth machine stone s urban regime together with the extension of unruh s thesis concerning the characteristics of lock in in the technological or institutional economics approach were used to propose an enlarged lock in political economic framework and pro growth institutional industry complex iic it is further used to explain the consensus building of the pro growth governance a study of the salt chemical and new material industry park in the huai an metropolitan area china serves as an illustrative case the article also suggests that the path dependence followed in constructing a pro growth coalition could serve as a program to unlock the pro growth institutional industry complex of salt chemical industry and foster the anti coalition needed

market liberalization and firm performance during china s economic transition this paper examines the impact of market liberalization on firm performance through institutional changes during the economic reform in china the conceptualization focuses on the decentralization of control ownership restructuring and industrial policy as the primary institutional changes to implement market liberalization in china these institutional changes affect firm performance by shaping managerial incentives affecting transaction and agency costs and making selective resource allocations across and within industries using a large scale data set including 23 577 firms between 1992 and 1996 the study examines how market liberalization affects the profitability and productivity of chinese firms and the relationship between ownership change and the performance of state owned enterprises

kinship networks and entrepreneurs in china s transitional economy1 this research draws insights from two theoretical traditions one is new institutionalism which emphasizes the role of institutions both formal and informal in economic growth the other is social network analysis which highlights the role of interpersonal relations in producing and enforcing informal norms integrating these two approaches yields the thesis that social networks affect economic growth via enforcing informal institutions the article focuses on the economic payoff of kinship networks in the context of china s rural industrialization to argue that kin solidarity and kin trust played an important role in protecting the property rights of private entrepreneurs and reducing transaction costs during the early stages of market reform when formal property rights laws were ineffective and market institutions underdeveloped data from 366 villages show that the strength of kinship networks has large positive effects on the count and workforce size of private rural enterprises and insignificant

2 the institutional structure of production 1 prize lecture to the memory of alfred nobel december 9 1991 this abstract was borrowed from another version of this item

diagnosing measurement equivalence in cross national research many researchers have pointed out that it is necessary to ensure measurement equivalence in cross national comparative research three aspects of measurement equivalence translation metric and calibration equivalence are necessary to establish the cross national reliability and validity of items used to measure theoretical constructs this paper discusses these issues and proposes two recently developed empirical techniques multiple group lisrel and optimal scaling for use in diagnosing cross national measurement equivalence these techniques are illustrated by reanalysis of a pioneering u s and japanese study the two techniques yield convergent results indicating measurement equivalence for some but not all ordinal level items under consideration the findings demonstrate that the proposed methods are useful diagnostic tools for exploring measurement equivalence several suggestions for reducing the likelihood of problems with measurement equivalence and a number of methods for dealing with items where lack of equivalence persists are also discussed

how the chinese government promoted a global automobile industry the claim by china experts that the chinese state lacks the capability to practice pro active industrial policy throws china s future into doubt this article argues the contrary by examining the development of the chinese automobile industry and the evolution of its industrial policy since 1978 the central state s policy may have been ineffective at first but continued to improve layer by layer by taking into account results of local experiments and being propelled by a strong catch up consensus providing performance standards to establish national industries china s learning process thus renders its industrial policy model effective in the long term copyright 2011 the author 2011 published by oxford university press on behalf of associazione icc all rights reserved oxford university press

property rights and stratification in socialist redistributive economies in socialist economies work organizations differ widely in the compensation they provide employees despite the absence of key product and labor market processes thought to ex plain such inequalities in market economies existing theories of stratification in socialist economies focus on the power and privilege of elites but inequalities among organizations are not created by political particularism or elite power in this paper i sketch elements of an institutional theory of stratification anchored in a conception of property rights the right to derive income from productive assets two aspects of property rights guide the analysis 1 the dispersion of property rights across a hierarchy of governmentjurisdictions and 2 the exercise of these rights by government jurisdictions as they extract revenues primarily through taxation extraction of revenues from a work organization varies with the budgetary resources of a government jurisdiction and the dependence of that jurisdiction on the out puts of the organization variation in revenue extraction in turn creates inequalities among work organizations in their abilities to provide benefits to employees an analysis of survey data on the provision of housing and benefits by work organizations in the large industrial city of tianjin china provides provisional support for these ideas s tudents of communist states have had little reason to dispute lenski s 1966 claim that the distribution of rewards in a society is a func tion of the distribution of power p 63 as ex emplified in szelenyi s wedding of elite theory to institutional economics this idea has been de veloped primarily in terms of the power of class es or occupational groups szelenyi 1978 be gan with the observation that planned economies operate according to redistributive rather than market principles however the process of re

decoding urban land governance state reconstruction in contemporary chinese cities in the rapidly growing literature on urban development in china many authors have emphasised the salient features of economic decentralisation and the increasingly significant role of the local state however such arguments neglect a counter trend in which the central state has deterritorialised and rehierarchised some key functions using the case of land governance this paper argues that facing the complication of changing urban conditions there is a resurgence of the state s regulatory power the decentralisation of economic governance is now counter balanced by the rise of state strategies to control the articulation of scales through which a more centrally consolidated power can be achieved the central government still serves as an important level of economic regulation in this sense new interpretations of commoditised urban transformation especially commoditised production of the built environment should be understood by underscoring the interplay between trends of decentralisation and terr

monetary policy and short term interest rates an efficient markets rational expectations approach this paper is an application of efficient markets rational expectations theory to analyze empirically the relationship of money supply growth and short term interest rates a hotly debated issue in the literature this approach has the advantage over earlier research on this subject in that it imposes a theoretical structure that allows easier interpretation of the empirical results as well as more powerful statistical tests the empirical results uniformly do not support the proposition that increases in money growth are correlated with declines in short rates the relationship between money supply growth and nominal interest rates is a hotly debated issue in the literature one view associated with keynesian structural macromodels has an increase in money growth leading at least in the short and medium runs to a decline in interest rates 2 an alternative view associated with milton friedman 6 7 indicates that interest rates might rise in response to higher money growth because there is a rise in inflationary expectations and hence a rise in interest rates through a fisher 5 effect

the dragon awakens innovation competition and transition in the energy strategy of the people s republic of china 1949 2017 abstract based on a mix of original archival research and an extensive literature review this article assesses the history of the people s republic of china s national energy policies since 1949 we divide this history into six phases emergence 1949 1957 socialist construction 1958 1965 turbulence 1966 1978 reform 1979 2000 contestation 2001 2014 and transition 2015 present over the whole history of more than sixty years china s energy production and consumption grew at a surprising speed while energy intensity exhibited early fluctuations and a subsequent gradual decrease after the turbulence phase in tracing this history the article offers new historical and policy insights into the world s largest developing country and a theoretical contribution to the role of the state in shaping economy and society through energy policy the article lastly offers an in depth exploration of how command and control style administrative intervention and low levels of market liquidity have had a prophylactic effect on innovation and competition

the isomorphism of local development policy a case study of the formation and transformation of national development zones in post mao jiangsu china it is often the case although it has not been well documented that local governments aiming for economic growth tend to formulate and implement very similar or even identical policies this phe

chinese industrial reform accomplishments prospects and implications why has china grown so fast when conditions thought to be necessary for growth were absent nowhere is this dissonance greater than in china s industrial sector which has recorded big gains in output employment and exports in the absence of privatization effective bankruptcy legislation and other policy innovations widely seen as prerequisites for successful reform this essay reviews the accomplishments of chinese industry since the start of reform in 1978 focusing on the internal dynamics of the development process considers the future of partial reform and discusses the implications of china s industrial reform experience

the development of china s solar photovoltaic industry why industrial policy failed this article studies china s central local government relations in the formation and implementation of an industry policy in china the central government is responsible for policy formation and the local governments are responsible for policy implementation where local governments are allowed ample flexibility in the ways to achieve the policy mandate this arrangement is conducive to local competition but there is no built in mechanism in the system to regulate such competition the system is defective in the execution of an industrial policy in that it fails to discipline the recipients of policy favours and to make efficient exit selections because local competition involves policy resources as well as economic resources the outcome of competition is not necessarily consistent with the comparative advantage of the region the more that policy is emphasised in industrial development the more that competition tends to favour large and rich cities after a certain period of hands off local competition the timing of which is unpredictable but will come when the industry runs into troubles the central government holds the ultimate power to determine the winners the central government typically picks the large and strong firms as the winners which are crowned as a national team and became eligible for further policy support this institutional set up produces a rapidly growing industry which often results in over capacity but not necessarily a competitive industry i use the case of china s solar photovoltaic industry to illustrate these points

a note on unanticipated money growth and interest rate surprises mishkin and makin revisited the relationship between monetary expansion and interest rates has long been an important macroeconomic issue friedman 1 hypothesized a dynamic adjustment process where the interest rate initially falls due to a liquidity effect then gradually rises in response to increased money demand higher prices and expectations of higher future inflation the relative size of these effects and the speed of the adjustment process are empirical questions that have recently received some attention in rational expectations econometric models in a recent article mishkin 5 found that interest rate and money growth surprises have a significant positive correlation makin 3 later published a paper where the correlation is negative and significant makin explained these contradictory findings as a result of the different method each uses to measure interest rates

on the job search in a labor market model ex ante choices and ex post outcomes abstract this paper builds a multi sector labor market model including wage dualism open unemployment underemployment on the job search and expected wage equalization the innovative feature of this model is the distinction between the ex ante allocation of the labor force among search strategies and the ex post allocation of the labor force among labor market outcomes among the findings are more efficient on the job search lowers the equilibrium unemployment rate in a rational expectations equilibrium the average rural and urban wages will not be equal modern sector enlargement may leave labor market conditions in one of the sectors unchanged even when wages and employment in that sector are fully flexible

governing china s transition to the market institutional incentives politicians choices and unintended outcomes this essay reviews two books that seek to account for china s success in making economic reforms and sustaining rapid growth one perspective explains china s reformist approach in terms of politicians making choices under certain institutional rules the other sees an economic logic of market transition and emphasizes policymakers limited abilities in governing the economy the essay assesses the merits of these competing claims it calls for better specification of the causal linkages between institutional rules and politicians choices and concludes that both the dynamics and dilemmas of china s political economy are explained in terms of increasing market competition finally the essay evaluates the argument that decentralization leads to market segmentation and points to the chinese government s evolving role in dealing with the economy

far from the tree do private entrepreneurs agglomerate around public sector incumbents during economic transition while it is well known that state enterprises in transition economies were displaced by private enterprises at a macro level little is known about whether private entrepreneurs emerged in a way that helped preserve or shift preexisting agglomerations of industrial activity at a microgeographic level to address this question we integrate competing perspectives on the role of large bureaucratic incumbents in spawning entrepreneurs we conceptualize a trade off between two countervailing effects of large incumbents on potential entrepreneurs bureaucratic socialization and exposure to capabilities this yields novel predictions about how different kinds of startups agglomerate around different kinds of incumbents we test these predictions using fine grained geographic data on founding rates by private entrepreneurs in china s bicycle manufacturing industry consistent with our theorized trade off we find evidence of a nonmonotonic effect of incumbent size on local founding rates by private entrepreneurs additional moderating effects are consistent with boundary conditions on the hypothesized mechanisms our results provide the first empirical investigation of the extent to which entrepreneurial activity agglomerated around public sector incumbents during economic transition we discuss how these insights add to the understanding of economic transition as well as how the context of economic transition adds to the understanding of entrepreneurial spawning

a social institutional approach to identifying generation cohorts in china with a comparison with american consumers identifying distinctive target segments is a fundamental challenge faced by international marketers this paper describes an approach to understanding consumer market structures in an important international market china and to segmenting chinese consumers by integrating insights from generational cohort and social institutional theories we conduct two empirical studies to verify how china s recent momentous ideological events could give rise to and affect the life experiences of different generation cohorts in the country the results of study 1 support the conceptual framework and establish three distinct cohorts in china red guards modern realists and global materialists study 2 builds on the findings of study 1 it links cohort differences to differences in consumer values materialism and choice behaviors foreign vs local brands and then compares them with parallel consumers in the united states this paper outlines and tests an approach to segmentation that can help international firms identify distinct segments in and design effective marketing strategies for china

china s changing urban governance in the transition towards a more market oriented economy china s changing urban development processes and urban landscapes in the transition towards a more market oriented economy have received extensive research attention in recent years relatively the governing of chinese cities is still underresearched this article aims to analyse the forces released both inside and outside the formal socialist state system and the impacts on phenomenal restructuring of urban governance especially at local levels marketisation has created new elements beyond the reach of state work units that represent the state s hierarchical control the pillars of the socialist governing structure the party state the work units system and household registration are shaken by these forces the changes in the organisation of people capital production materials infrastructure and space fundamentally demand new urban governance territorial organisations such as the municipality urban districts street office and residents committees are reinvented and consolidated to restore a governable society the devolution towards the base level and the reinvention of local communities reflect the state s attempt to reconsolidate its power to create a governable society as well as to cope with practical pressures such as the provision of social assistance to poor and aged residents re employment of laid off workers and the management of floating immigrants the combination of new market elements and decentralised state apparatus has given rise to the entrepreneurial endeavour of china s governance this research highlights the micro foundation of the new urban governance in addition to the globalisation capital mobility city competitiveness thesis

capital structure in transition the transformation of financial strategies in china s emerging economy during economic transition firms must dramatically reduce their financial dependence on the state and begin to borrow from nonstate capital sources this paper draws on institutional and resource dependence theories to examine this fundamental transformation of firm capital structure during china s transition i propose that managers borrowed from external sources even when internal funds were available because retained earnings were considered state assets firms used retained earnings to signal financial health but borrowed externally to reduce dependence on the state uncertainty during transformation produced interfirm imitation of borrowing strategies particularly imitation of local and high status others i argue that the dynamics of market development shaped firm borrowing strategies and that these strategies are best viewed as trajectories over time analysis of survey data on the 1980 1989 capital structure of formerly state owned firms provides support for these arguments and highlights the importance of institutional context in understanding corporate borrowing and strategic decision making

the relative effects of unemployment insurance parameters on search strategy abstract this paper theoretically examines the relative effect of two unemployment insurance parameters on search behavior the relative influence of each parameter is found to depend upon what an individual could expect to earn if he worked part time while searching

how much does subnational region matter to foreign subsidiary performance evidence from fortune global 500 corporations investment in china what explains the heterogeneity of foreign subsidiary performance previous studies have emphasized the importance of industry corporate parent and home country effects on the variation of foreign subsidiary performance building on recent international business and economic geography research this study examines the extent to which subnational region effects can also explain such performance variation we empirically decompose the variance of the performance of fortune global 500 corporations subsidiaries in china during 1998 2006 results show that not only are subnational region effects statistically significant in explaining the variation of subsidiary performance but their interactions with industry corporate parent and home country effects are also significant and economically important we further show that subnational region effects tend to be stronger in the period prior to china s wto accession and in the country s less developed subnational regions our findings highlight the importance of considering both the direct and indirect roles of subnational region in shaping firms strategy and performance in international business research

beyond national culture and culture centricism a reply to gould and grein 2009 leung bhagat buchan erez and gibson provide a review of several advances in research on culture and international business ib which is criticized by gould and grein as overemphasizing the national culture nc approach this reply clarifies the misinterpretation of leung et al by gould and grein and affirms its pluralistic and inclusive position in response to their critique we discuss the complex meaning of culture address the dynamic processes of culture change in a globalizing world and substantiate the pivotal role of nc in ib research we encourage diverse perspectives that complement rather than compete against each other and advocate a dual perspective approach that integrates positivist and interpretative frameworks for theoretical innovation

engineering growth business group structure and firm performance in china s transition economy business groups have received increasing attention from academics interested in interorganizational relations and their impact on firms as part of industrial reform the chinese government began in the mid 1980s to encourage firms to form business groups with structural characteristics that promised to enhance financial performance and productivity using 1988 90 panel data on china s 40 largest business groups and their 535 member firms the study finds that the presence and predominance of interlocking directorates and finance companies in business groups improved the financial performance and productivity of the groups member firms in addition firms in groups with nonhierarchical organizational structures performed better than firms in hierarchical groups suggesting that complete integration into a hierarchical organization is not an optimal strategy

phase transitions and emergence of entrepreneurship the transformation of chinese soes over time abstract configurational theory has been a key building block of organizational research an understanding of how certain configurations evolve over time especially during discontinuous changes such as economic transition has been largely a missing link in the literature considering economic transition as a process rather than an outcome this study examined strategic adaptations among chinese soes in two phases 1990 and 2002 findings from two surveys and from interviews revealed that environmental characteristics changed significantly over time and that firms responded with more entrepreneurial strategies aimed at firm growth rather than at satisfying state planners such changes were related to improved performance the study closes by offering implications for research and practice

the structure of ownership and the theory of the firm the separation of ownership from control produces a condition where the interests of owner and of ultimate manager may and often do diverge and where many of the checks which formerly operated to limit the use of power disappear in creating these new relationships the quasi public corporation may fairly be said to work a revolution it has divided ownership into nominal ownership and the power formerly joined to it thereby the corporation has changed the nature of profit seeking enterprise 1

local governments as industrial firms an organizational analysis of china s transitional economy despite widespread skepticism about government ownership in transitional economies china s rapid industrial growth has been led by public enterprises kornai s theory of soft budbet constraints born of the failure of earlier hungarian reforms fosters such skepticism but it assumes as fixed organizational characteristics that in fact vary widely across government jurisdictions local governments with smaller industrial bases have clearer financial incentives and constraints fewer nonfinancial interests in enterprises and a greater capacity to monitor them in china s vast public sector the fastest growth in output and productivity has occurred where government ownership rights are clearest and most easily enforced which enables officials to manage public industry as a diversified market oriented firm

regional institutions ownership transformation and migration of industrial leadership in china the case of the chinese synthetic dye industry 1978 2008 scholars have emphasized the gradual ownership transformation of enterprises as a key driver of the chinese economy s unprecedented growth however little work has been done on the issue of whether this transformation process takes place evenly across the various regions in china this article describes the important role of regional institutions in shaping the ownership based competitiveness of local enterprises and the migration of industries across regions in the case of the chinese synthetic dye industry the passing of leadership from state owned enterprises soes to collectively owned enterprises coes and then to private enterprises pes was accompanied by a concurrent leadership migration from one region to another the article contends that this simultaneous occurrence was not accidental four institutional constraints the degree of central supervision the local labor arrangements the local social welfare provision and the degree of ambiguity in property rights retarded the rise of new ownership forms in the previously dominant regions this gave other regions the opening to take over leadership positions by providing a more favorable institutional context for new ownership forms these findings are likely to apply to all of the chinese manufacturing industries that existed prior to 1978 and that subsequently did not experience significant technological changes and were not highly protected by the government

ceo hubris and firm risk taking in china the moderating role of managerial discretion this study linked ceo hubris to firm risk taking and examined the moderating role of managerial discretion in this relationship drawing on upper echelons theory and behavioral decision theory we

measurement issues in cross national research substantive inference from cross national studies have important implications for theory e g because they reveal insights into generalizability and boundary conditions and managerial practice e g because they offer guidelines to mnc managers however few empirical studies attend to measurement issues involved in cross national research and still fewer recognize the risk of inferential errors that are likely to occur by overlooking measurement issues we discuss four measurement issues namely 1 standardized versus unstandardized coefficients 2 the impact of measurement error and unequal reliability 3 the overall error rate and simultaneous analysis and 4 construct equivalence using illustrate examples we demonstrate the nature of each of these problems the likely impact they can have on substantive conclusions and approaches for tackling these problems additionally we reanalyze a recently published three nation study by dubinsky michaels kotabe lim and moon 1992 to clarify these measurement concerns highlight a methodological approach and delineate the extent and severity of inferential errors our reanalysis shows that the interactive effects of these measurement issues are pervasive complex and unpredictable we close with implications for cross national research in general

international product positioning one of the cornerstones of a firm s marketing strategy in any market is the development of an appropriate product positioning plan this paper argues that may of the same considerations that go into the positioning strategy in the home country are directly relevant for international markets there is an added elements of complexity in that the country of origin of the imported product will often be a salient factor in the buyer evaluation process the effect of country stereotype will be to shift the position of the product in the perceptual space and alter the overall evaluation of its merits the competitive strength of the product will thus be affected by country biases the paper shows how these factors can be dealt with in the management of the international product positioning task

leaders managers and the organization of township and village enterprises in china abstract the managerial contractual form in china s township and village enterprise tve sector has evolved rapidly during the past 10 years our paper uses descriptive data and a theoretical model to demonstrate that these changes may be occurring in response to the rapid development of markets in transitional rural china we econometrically test the model s main hypotheses showing that the driving force behind the movement from a leader run fixed wage contract to a fixed payment contract with better incentives for the manager is the relative value of non marketed inputs owned by local leaders and firm managers firm technical structure and local market setting also plays a role in the determination of firm contractual form

organizational processes to meet new performance criteria chinese pharmaceutical firms in transition abstract the current crisis in china s state owned enterprises presents a paradox of performance since reforms began in the early 1980s many state owned enterprises are producing and selling more some even reporting increasing profits recent discussions of the crisis facing these firms however reveal that most of the gains in these performance outcomes has been achieved without regard for efficiency in many cases simply by increasing inputs only now has the government explicitly recognized the need to shift emphasis from measures of performance based on scale whether output sales or profits to those incorporating considerations of efficiency return on output sales and assets we investigate the managerial and policy implications of such a shift in key performance criteria using longitudinal data on 66 chinese pharmaceutical manufacturers we find that both the level and growth in physical assets are the strongest correlates of scale based performance measures in contrast activities which bring in engineering skills lead to new product development and increase the proportion of output that is actually sold are the strongest correlates of efficiency based performance measures for managers and policymakers these results have important implications for the timing and level of investment in particular organizational activities and resources

elite opportunity in transitional economies command economies gave communist era elites administrative control and material privilege but severely restricted money income and private wealth markets and privatization have injected new value into public assets and create unprecedented opportunities for elite insiders these opportunities depend on the extent of regime change and barriers to asset appropriation regime change varies from the survival of the entire party hierarchy to its rapid collapse and defeat in competitive elections barriers to asset appropriation vary with the extent pace and form of privatization and the concentration and liquidity of assets different combinations of such circumstances jointly affect the extent to which prior elites obtain ownership or control of privatized assets use political office to extract larger incomes move into salaried elite occupations or fall out of the elite altogether regime change and barriers to asset appropriation affect change at the national level but outcomes vary across economic sectors because of characteristics of organizations elite positions and assets this elementary theory serves to integrate varied findings from recent research on central europe china and russia and yields predictions for other regions

does human resource management matter in a transitional economy china as an example this paper investigates the significance of how firms manage their human resources hrs within the confines of powerful social institutions in a transitional economy the people s republic of china china we propose that two dimensions the role of human resource management rhr and followers perception of the leader top are important contributors to firm performance as are the influences of the regional economy and firm ownership we tested our hypotheses with a survey of 180 firms from nine cities in china we found that both role of hrm rhr and follower s perception of top level management top are important to firm performance the study confirms that while social institutions remain powerful in a transitional economy effective hrm is important to firm performance

unemployment insurance rules joblessness and part time work developed and under general conditions an increase in the disregard is shown to increase both the part time and overall re employment hazards data from the current population survey s displaced worker supplements are used to test these predictions estimates from a competing risks model with correlated risks and time varying coefficients shows that increasing the disregard significantly increases the conditional probability of part time re employment during the first three months of joblessness

corruption and investment theory and evidence from china abstract we consider a principal agent model to examine the conditions under which corruption prompts investment we also investigate three policies that can be used to combat corruption strengthening monitoring increasing compensation and enhancing accountability our theory suggests that increasing monitoring intensity mitigates corruption at the cost of reduced investment the most cost effective policy to control corruption is to enhance accountability which reduces corruption without decreasing growth enhancing investment we test our theo retical predictions using chinese infrastructure investment and corruption data the data show that infrastructure investment is negatively correlated with anti corruption effort as predicted by the theoretical model