The Ethical Decision Making of Men and Women Executives in International Business Situations

While a number of studies have examined the impact of gender/sex on ethical decision-making, the findings of this body of research do not provide consistent answers. Furthermore, very few of these studies have incorporated cross-cultural samples. Consequently, this study of 222 American and Spanish business executives explored sex differences in ethical judgments and intentions to act ethically. While no significant differences between males and females were found with respect to ethical judgments, females exhibited higher intentions to act more ethically than males. This difference was true of both U.S. and Spanish executives. Further research is warranted to develop a clearer understanding of the linkage between ethical judgment and intention to act in an ethical manner. These findings have implications for global firms, particularly regarding codes of conduct and ethics training. Sean Valentine is an Assiciate Professor of Management at the University of Wyoming. His research has appeared in journals such as Human Relations, Journal of Business Research, Journal of Business Ethics, and Journal of Personal Selling & Sales Management. Terri Rittenburg is an Associate Professor of Marketing at the Univesity of Wyoming; she is a member of the Editorial Policy Board for the Journal of Macromarketing. Her research has appeared in journals such as Psychology and Marketing, Journal of Business Ethics, and Journal of Macromarketing.     

Internationalization of Western Venture Capitalists into Emerging Markets: Risk Assessment and Information in India

This paper provides the first analysis of the internationalization of venture capital firms through an examination of risk assessment and information usage by firms in India. Personal interviews were conducted with executives in 31 (84%) of the active venture capital firms. The paper extends previous research by comparing perceptions of the behavior of domestic venture capital firms in India, foreign (primarily U.S.) venture capital firms in India and U.S. venture capital firms in their domestic markets. Foreign firms in India place significantly greater emphasis on product market factors and accountants' reports than domestic firms in India. They place significantly less emphasis on financial contributions of management in assessing risk and own due diligence and information from entrepreneurs than do U.S. firms in their domestic market. They make more use of information from trade publications and relating to production capacity and technology and information from accountants' reports than do domestic venture capital firms in India. The evidence is consistent with venture capital firms adapting to local market conditions rather than implementing "recipes" from their domestic markets.     

Learning by doing: Cross-border mergers and acquisitions

We rely on organizational learning theory and strategic momentum research to examine the international merger and acquisition (M&A) activities of a sample of S&P 500 firms. We hypothesize that the learning associated with a firm's prior acquisition experience increases the likelihood the firm will engage in subsequent international acquisitions. Results from a sample including company-country level data indicate that both prior domestic acquisitions and international acquisitions influence the likelihood of acquisitions in foreign markets by U.S.-based firms. We also find that prior experience with international acquisitions is more predictive of subsequent international acquisitions than prior domestic acquisition experience. Moreover, we find that the acquisition experience within a host country had a stronger influence on subsequent acquisitions within that country than other prior non-host country international acquisition experiences.     

Playing away to win at home

This paper presents a model of the interaction between two rival firms based in the same country. Each firm must decide how to serve a foreign market (export or foreign production) and how much to invest in a corporate-wide asset that reduces production costs and/or augments the willingness-to-pay for their product. In this scenario, the firms’ foreign direct investment decisions are interdependent. Furthermore, strategic motives for FDI relate to a firm's domestic, as well as foreign, market profits. One possibility is that a firm sets up overseas production even though its foreign market profits would be higher by exporting.     

Disaster selfies: How ethical reminders can mitigate morally questionable consumption practices

Joyful selfies taken at disaster sites create a controversial topic in terms of moral boundaries in digital life. While some consider it acceptable to take smiley selfies in a tragedy zone, others find this behaviour morally questionable. This article demonstrates empirically that excessive time spent on social media explains, at least partially, a greater tendency to like morally ambiguous content on social media. Specifically, this article shows that consumers tend to like more questionable content (such as smiley disaster selfies) on social media when they spend more time online. Further, this article shows that this effect is mediated by increased individualistic thinking. Responses to the survey experiment (N = 206) compared the tendency to like morally ambiguous content between groups of little, moderate and excessive use of social media, and tested for the mediating role of individualistic thinking on the relationship between time spent and liking behaviour. Second, the moderating role of an ethical reminder on time spent and the fact of liking morally ambiguous contents is demonstrated. In the presence of an ethical reminder, the effect of time spent on social media and liking morally ambiguous content becomes insignificant. This article contributes to theory on social media consumption by offering a novel underlying mechanism, such as increased individualistic thinking, as one variable that partly explains the liking for morally ambiguous content. This article also offers practical contributions for social media platforms and policy makers, showing that ethical reminders could be a possible and simple nudge to help consumers act more morally or become aware of morally questionable content.     

The Effects of Fraud and Lawsuit Revelation on U.S. Executive Turnover and Compensation

This study investigates the impact of fraud/lawsuit revelation on U.S. top executive turnover and compensation. It also examines potential explanatory variables affecting the executive turnover and compensation among U.S. fraud/lawsuit firms. Four important findings are documented. First, there was significantly higher executive turnover among U.S. firms with fraud/lawsuit revelation in the Wall Street Journal than matched firms without such revelation. Second, although on average, U.S. top executives received an increase in cash compensation after fraud/lawsuit revelation, this increase is smaller than that of matched non-fraud/lawsuit firms. Third, fraud/lawsuit firms were more likely to change top executive when chief executive officer (CEO) was not the board chairman and CEO had been on the board for a short time. Fourth, fraud/lawsuit firms were more likely to reduce their executive cash compensation when profitability was low, firms were involved in fraud, the compensation committee size was small, and the board met more often. These findings indicate that although, in general, U.S. fraud/lawsuits firms did not reduce their executive cash compensation, those involved in fraud were more likely to reduce their executive cash compensation than to change their top executives. The finding, that ethical standards is not a significant factor for U.S. executive turnover nor compensation reduction, suggests that ethics appears to play no part in the board’s decisions, and that U.S. firms may have ethical standards in writing but they do not implement nor enforce the standards.     

Firm heterogeneity and location choice of Taiwanese multinationals

This paper examines the extent to which production location decisions of Taiwanese multinationals reflect underlying patterns of firm productivity. In our theoretical model, heterogeneous firms in a middle-income country decide on the optimal production locations for serving three geographically separate markets: domestic, foreign high-income and foreign low-income. The model shows that the equilibrium decision of a firm depends on the fixed investment costs of establishing foreign subsidiaries, production costs, transportation costs, market size and its own productivity level.

Using firm-level data in 2000, Taiwanese electronics firms are divided into four different categories: non-FDI, investors in China only, investors in the U.S. only, investors in both China and the U.S. We use a multinomial logit model to link firms' location choices with their productivity, controlling for country, industry and other firm characteristics. Our empirical results are consistent with the predictions of the theoretical model. We show that more productive firms engage in outward FDI, with the most productive ones investing in both China and the U.S. We also provide evidence indicating that Taiwanese multinationals investing only in the U.S. are more productive than those investing exclusively in China due to smaller fixed investment costs in China relative to the U.S.     

Firm heterogeneity and location choice of Taiwanese multinationals

This paper examines the extent to which production location decisions of Taiwanese multinationals reflect underlying patterns of firm productivity. In our theoretical model, heterogeneous firms in a middle-income country decide on the optimal production locations for serving three geographically separate markets: domestic, foreign high-income and foreign low-income. The model shows that the equilibrium decision of a firm depends on the fixed investment costs of establishing foreign subsidiaries, production costs, transportation costs, market size and its own productivity level.Using firm-level data in 2000, Taiwanese electronics firms are divided into four different categories: non-FDI, investors in China only, investors in the U.S. only, investors in both China and the U.S. We use a multinomial logit model to link firms' location choices with their productivity, controlling for country, industry and other firm characteristics. Our empirical results are consistent with the predictions of the theoretical model. We show that more productive firms engage in outward FDI, with the most productive ones investing in both China and the U.S. We also provide evidence indicating that Taiwanese multinationals investing only in the U.S. are more productive than those investing exclusively in China due to smaller fixed investment costs in China relative to the U.S.     

Firm heterogeneity and location choice of Taiwanese multinationals

This paper examines the extent to which production location decisions of Taiwanese multinationals reflect underlying patterns of firm productivity. In our theoretical model, heterogeneous firms in a middle-income country decide on the optimal production locations for serving three geographically separate markets: domestic, foreign high-income and foreign low-income. The model shows that the equilibrium decision of a firm depends on the fixed investment costs of establishing foreign subsidiaries, production costs, transportation costs, market size and its own productivity level.Using firm-level data in 2000, Taiwanese electronics firms are divided into four different categories: non-FDI, investors in China only, investors in the U.S. only, investors in both China and the U.S. We use a multinomial logit model to link firms' location choices with their productivity, controlling for country, industry and other firm characteristics. Our empirical results are consistent with the predictions of the theoretical model. We show that more productive firms engage in outward FDI, with the most productive ones investing in both China and the U.S. We also provide evidence indicating that Taiwanese multinationals investing only in the U.S. are more productive than those investing exclusively in China due to smaller fixed investment costs in China relative to the U.S.     

The Foreign Corrupt Practices Act's Consquences for U.S. Trade: The Nigerian Example

A by-product of the Watergate investigations into illegal political contributions and money-laundering was the revelation that American corporations had been making questionable payments to foreign officials to gain business advantages. That discovery was the driving force behind passage of the FCPA in 1977. Many since have complained that the law put American firms at a disadvantage in international trade. This paper assesses the credibility of that claim, as well as exploring the socioeconomic implications of corruption in a world of intensifying international competition. Based on the literature review, examination of international trade data and intensive interviews with foreign firms doing business in Nigeria, the paper reaches the following conclusions:1. Enforcement of FCPA has waxed and waned, but there is no evidence that its enforcement has impeded the growth of U.S. trade. In fact, trade with countries previously considered "bribe prone" has out-paced the growth of trade with non-bribe-prone countries, despite FCPA.2. Those American corporations which, in the past, were guilty of international bribery did so as a short-cut when adherence to time-honored ethics could have accomplished the same or better results.3. The "Storehouse of Knowledge" maintained by successful firms has been far more influential in promoting exports than any questionable payments they might be tempted to make.4. In most of the questionable payments investigated, American corporations had indulged in bribery to gain a competitive edge over other U.S. firms rather than foreign ones.5. Whatever the result, international bribery is inherently wrong for the same reason that domestic bribery is wrong.Despite criticism of it, FCPA has benefitted honest U.S. firms by reducing unfair competition among other American firms which comprise about 80 percent of the world's true multinationals. For multinationals to function in anything other than a transparent manner would be to impede the spread of democratic governments and market economies worldwide.     

Empirical asymmetries in foreign direct investment and taxation

This paper assesses the sensitivity of the operations of multinational corporations (MNCs) to host country taxation. The empirical analysis is based on two different measures of MNC activity by U.S. majority-owned foreign affiliates: panel data for aggregate real gross product in manufacturing that originates in a given host country and micro data for a single year regarding the likelihood of a firm locating in a given host country. The empirical estimates indicate that investment geared toward export markets, rather than the domestic market, is particularly sensitive to host country taxation, that this sensitivity appears to be greater in developing countries than developed countries, and that it is becoming greater over time.     

Civil disobedience and whistleblowing: A comparative appraisal of two forms of dissent

This paper compares and evaluates two forms of dissent: civil disobedience — protests by citizens against the laws or actions of their government; and whistleblowing — disclosure by employees of illegal, immoral or questionable practices by their employees. Each is identified, the conceptual issues are distinguished from strategic and normative ones and parallel moral questions posed. Should one first dissent within prescribed channels before going outside them? Should one act publicly or is withholding one's identity permissible or desirable? What is the basis and limits for one's loyalty to one's country or employer, and how can transgressing these limits be morally justified?     

Foreign equity flows and the “Size Bias”: Evidence from an emerging stock market

This paper examines foreign investors' equity-level transactions in an emerging stock market, the Istanbul Stock Exchange, for the period 1997–2008 to derive insights into the debate on information asymmetries between domestic and foreign investors and the home bias puzzle. The analysis suggests two important findings. First, foreign investors do not consider the market portfolio of domestic securities as predicted by standard theories of international portfolio diversification. Second, the firm's size and the expected return are central to explain foreign investors' equity trades. The results are consistent with models based upon the hypothesis of differential information between foreign and domestic investors.     

Trade,Tariffs and Total Factor Productivity: The Case of Spanish Firms

The aim of this paper is to examine the sensitivity of total factor productivity (TFP) to foreign competition in the case of a European country. Using the Olley and Pakes method, we calculate the TFP of Spanish manufacturing firms and study the impact of EU tariffs and the presence of foreign products and imports on TFP at the firm level. Applying the System‐GMM method, we find that TFP is negatively impacted by European tariffs, whereas competition in the form of the increased presence of foreign products in the domestic market and firm imports leads to improvements in the TFP. Moreover, these two effects are complementary. We also find evidence of important asymmetries among firms depending on their involvement in foreign markets.     

Ethical Aspects of Using Government to Subvert Competition: Antidumping Laws as a Case Study of Rent Seeking Activity

This article examines the question of whether it is ethical for company officials to use the force of government to reduce or eliminate foreign competition, using the antidumping laws as a case study. This article begins with a brief examination of the U.S. antidumping laws and then examines several ethical questions related to the antidumping laws. The main question to be addressed is whether, and under what circumstances, it is ethical for domestic producers to ask government to launch an antidumping investigation against a foreign competitor. Related questions to be examined include (1) Whether it is ethical to ask the government to launch an antidumping investigation even when the domestic company making the request knows that dumping has not occurred; (2) Whether it is ethical to ask for an antidumping investigation in cases where dumping (according to the definition of dumping) has occurred, where the effect is to help domestic producers at the expense of the general public. This article examines these questions by applying both utilitarian and non-utilitarian approaches.     

How ethical are purchasing management professionals?

The primary purpose of this study was to assess the ethics of purchasing management professionals. A multidimensional scale of ethics was used to measure their predispositions to act morally. The ethics measure from this scale was correlated to a series of ethical vignettes specific to the purchasing function to further assess the value of the scale. In addition, the consistency of values as rationale for decision making was also examined. The findings of the study indicate that purchasing professionals appear to be more ethical than indicated in previous studies as measured by both the multidimensional scale of ethics and their responses to ethical situations similar to those faced in their day-to-day work experiences. The utility of a multidimensional scale of ethics is further validated, and some preliminary assessments of the nature of values impacting on ethical decision making are also evaluated.Robert Landeros, is associate professor of Integrated Supply Management at the Haworth College of Business, Western Michigan University, U.S.A., and visiting associate professor of logistics at the Norwegian School of Management, Sandvika, Norway. He has researched and published in the area of interorganizational relationships.Richard E. Plank, is associate professor of Marketing at the Haworth College of Business, Western Michigan University, Kalamazoo, Michigan, U.S.A. His research interests are in the areas of purchasing, personal selling, and the buyer-seller interface.     

The comparative role of iShares and country funds in internationally diversified portfolios

This paper examines the performance and diversification gains provided by iShares versus closed-end country funds over the period 1996 through 2006. Findings include: (1) iShares reveal weaker effects from U.S. market exposure than do country funds; (2) U.S. investors react similarly to foreign currency risk associated with iShares and country funds; (3) the average risk-adjusted performance of passively managed iShares is better than that of their respective actively managed country funds; and (4) iShares provide U.S. investors greater diversification gains than do country funds, that is, U.S. investors should prefer iShares to country funds when diversifying portfolios internationally.     

How Strong are the Ethical Preferences of Senior Business Executives?

How do senior business executives rank their preferences for various ethical principles? And how strongly do the executives believe in these principles? Also, how do these preference rankings relate to the way the executives see the future (wherein business decisions play out)? Research on these questions may provide us with an appreciation of the complexities of ethical behavior in management beyond the traditional issues concerning ethical decision-making in business. Based on a survey of 585 vice presidents of U.S. businesses it was found that: (1) there is a distinct set of principles of ethical conduct that is considered favorable as opposed to another set considered unfavorable among a comprehensive list of 14 ethical principles; (2) the executives believed overwhelmingly that their own individual ethical preferences are better than those of other executives; (3) the strength of their preferences for ethical principles is associated with whether the executives are relatively near-future oriented or more distant-future oriented; and (4), there are very few significant differences in terms of gender, age, education level, private/public education, prestigious/other schools, business/non-business academic backgrounds, and length of job experience. Implications of these findings are discussed.     

Foreign expansion of small firms: The impact of domestic alternatives and prior foreign business involvement

This research analyzes foreign expansions of small firms. In particular, we look at how a small firm's foreign expansion is affected by the join effects of prior foreign business involvement and other factors. We found that when encountering performance downturn and market size decline, small firms with prior foreign business involvement are more likely to use foreign expansion to deal with the problems. This suggests that organizational characteristics mediate the relationship between competitive threats and foreign expansion activities. We also found that small firms' foreign diversification is affected by their product and domestic expansions, suggesting foreign activities of small firms are closely related to their non-foreign strategies.     

央行外汇市场干预与协调国内货币政策

我国央行的汇率政策目标已演变成稳定汇率的单一目标,央行频繁地对外汇市场进行冲销干预,使人民币对美元的名义汇率处于超稳定状态,这种汇率政策的施行与国内货币政策目标可能协调,也可能发生冲突。国家应采取综合治理的办法,提高人民币汇率波动的弹性,大力发展债券市场回购,以加强对基础货币的调控