Explaining business cycles in small open economies: ‘How much do world prices matter?’

This paper analyzes the role of world price shocks - fluctuations in the prices of capital, intermediate, and primary goods, and in the world real interest rate - in the generation and propagation of business cycles in small open developing countries. I construct a stochastic dynamic multi-sector small open economy model. The model is a variant of the specific-factors model and reflects the major structural characteristics of developing economies. I utilize variance decomposition methods to quantitatively evaluate the impact of world price shocks. The results indicate that world price shocks account for a significant fraction of business cycle variability in developing countries.     

Understanding the evolution of world business cycles

This paper studies the changes in world business cycles during the period 1960–2003. We employ a Bayesian dynamic latent factor model to estimate common and country-specific components in the main macroeconomic aggregates (output, consumption, and investment) of the G-7 countries. We then quantify the relative importance of the common and country components in explaining comovement in each observable aggregate over three distinct time periods: the Bretton Woods (BW) period (1960:1–1972:2), the period of common shocks (1972:3–1986:2), and the globalization period (1986:3–2003:4). The results indicate that the common (G-7) factor explains, on average, a larger fraction of output, consumption and investment volatility in the globalization period than it does in the BW period.     

Macroeconomic shocks and the co-movement of stock returns in Latin America

This paper studies the economic sources underlying the co-movement of real stock returns in Latin America. Following the literature on structural vector autoregressive models (SVARs), I use long-run restrictions to identify three structural shocks: demand, supply, and portfolio shocks. For some countries, portfolio shocks are important factors behind real stock returns. Furthermore, these shocks seem to be important in explaining cross-country co-movement patterns. However, these findings are not statistically strong due to the degree of uncertainty about the estimates of the importance of each structural shock and the cross-correlation coefficients. Therefore, macroeconomic shocks (supply and demand) cannot be neglected in accounting for the dynamics of real stock returns.     

Sources of sectoral fluctuations in business fixed investment

A model of macroeconomic complementarity is used to assess causes of comovement in investment spending across nine sectors of the U.S. economy. It is hypothesized that the irreversibility and uncertainty of investment spending imply a greater role for investment linkages and aggregate factors in investment fluctuations compared with estimates for employment and output. For the average sector, past investment growth across all sectors, changes in aggregate demand, and a common factor account for two-thirds of the variance of investment growth. After accounting for aggregate demand, sectoral shocks explain 70% of the average sector’s innovations to investment growth.     

Heterogeneity in business groups and the corporate diversification-firm performance relationship

This article examines how heterogeneous features among business groups influence the corporate diversification-firm performance relationship. The study classifies heterogeneity along three dimensions: group size, group diversity, and share ownership. Using a sample of firms from India, the study finds some evidence that for firms affiliated to larger business groups, corporate diversification enhances firm performance. However, business group diversity does not influence the diversification-performance relationship. The impact of diversification on firm performance differs substantially owing to the heterogeneity in share ownership. The paper documents an interesting interplay between business group and ownership structure.     

对完善我国商业秘密法律保护的构想

目前,我国商业秘密法律保护的地位不够明确,保护商业秘密的法律规定过于分散,操作性不强;在调整范围上,相关法律、法规存在着一定的局限性。完善我国商业秘密的法律保护,应借鉴国外在民法典中、在侵权行为法中、在反不正当竞争法中的商业秘密保护以及商业秘密的专门立法方面的立法例,制订专门商业秘密保护法;进一步加强我国工商行政管理机关对商业秘密的保护;加大我国法院和仲裁机构对商业秘密侵权的救济。企业必须树立和加强商业秘密这种无形财产权的权利意识,健全商业秘密保护机制,明确保密内容,确立完善的防范措施。     

Practicing fairness in the family business workplace

One of the main challenges facing family firms is achieving fairness between family and non-family employees in the workplace. Family and non-family employees have the potential to offer unique and distinct contributions to the firm, which makes the achievement of fairness between them messy and complicated. Hence, two interesting questions are worth exploring: Given the complex nature of the family business human capital, how can family firms achieve fairness between family and non-family employees? Why should family business decision makers and advisors promote fair practices in the family business workplace? We first introduce a fair process model as a possible solution for family businesses to achieve fairness between family and non-family employees. Then, based on several examples and studies, we show that family business owners can benefit significantly from promoting fairness in the workplace both in terms of preserving business reputation and in terms of achieving long-term family business survival and success.     

Exporting and productivity in business services: Evidence from the United States

Does exporting make firms more productive, or do more productive firms choose to become exporters? This paper considers the link between exporting and productivity for a sample of firms in US business services. We find that larger, more productive firms are more likely to become exporters, but that these factors do not necessarily influence the extent of exporting. This conforms with previous literature that there is a self-selection effect into exporting. We then test for the effect of exporting on productivity levels after allowing for this selection effect. We model both the relationship between exporting and productivity, and a simultaneous relationship between export intensity and productivity after allowing for selection bias. In both cases we find an association, indicating that productivity is positively linked both to exporting and to increased exposure to international markets.     

Grief recovery from the loss of a family business: A multi- and meso-level theory

In this article I develop a multi- and meso-level theory of grief recovery time from the loss of a family business. The multi-level aspect of the model suggests how primarily micro theories of grief and sense-making can help explain grief recovery time at the family group level. The meso-level aspect of the model provides insight into recovery from the loss of a family business by proposing how grief dynamics interact at the individual level through emotional intelligence and the family group level through emotional capability. By supplementing theories of grief with those of sense-making, the model provides a deeper understanding of the grief recovery process. This model has implications for scholars and practical implications for family business members and the family unit.     

Understanding and breaking the rules of business: Toward a systematic four-step process

Knowing the rules of a business is a prerequisite of being successful. On the other hand, carefully and selectively breaking the rules of management is often the way to exceed the low margins of intensively competitive arenas, especially at a time when technological innovation is limited and industries are tending to consolidate. Drawing on their own practical know-how and intensive research into future business models, the authors of this article call for more dialectic in management thinking. Their “rule-breaking strategy creator” process is a combination of tested consulting and venture capital tools, and provides an entirely new approach to systematic rule-breaking and, thus, competitive advantages.     

Market power in banking,countercyclical margins and the international transmission of business cycles

By introducing an imperfectly competitive banking sector into a standard two-country, two-good RBC model with complete asset markets, we study the international transmission of aggregate TFP shocks in an environment with noncompetitive financial intermediation. In this model, price-cost margins in a global loan market are endogenous and countercyclical. As a result, a positive TFP shock in one country spills over to another through a reduction in the global cost of both credit and externally financed investment. The quantitative analysis shows that countercyclical margins on loans play a key role in bringing the predictions of the theory closer to the observed cross-country cyclical co-movements of consumption, employment, investment and output. Recessions are deeper when the cost of credit rises during these economic downturns. Thus, a financial accelerator arises in our framework, unveiling the increased importance of stabilization policies in economies where margins in credit markets are countercyclical.     

世界豆油期货市场关联性研究:基于中美两国的实证分析

期货市场国际关联性是同一期货合约的价格在各国市场上的相互关系。本文通过采用协整检验、方差分解和脉冲响应等技术对世界最大两个豆油期货市场的关联性研究发现:大连、芝加哥交易所豆油期货价格和中国豆油现货平均价格之间存在长期均衡关系。大连豆油期货市场的影响力与权威性都比芝加哥市场强大。     

Local enablers of business models: The experience of Brazilian multinationals acquiring in North America

Despite the rapid growth of South–North investments, the literature is still incipient to look into the broad range of issues associated with them. This article focuses on reverse takeovers and discusses the reasons why emerging-country firms, Brazilian multinationals in particular, are able to profitably acquire firms in developed countries, chiefly in the United States. The research addresses two specific subjects in international business literature: country-choice and entry-mode. The analytical approach assumes that reverse takeovers are part of the dynamic reconfiguration of global production systems which, in turn, are influenced by shifting conditions in countries' business environments. Changes in business environments impact local firms' business models and their positioning in global production networks and international markets as well. Reverse takeovers are facilitated when both the simultaneous evolution of the developed country multinational and the emerging country multinational business models establish a common ground for the transaction. Through the analysis of Brazilian multinationals' acquisitions in North America, relevant insights pertaining to the realms of firm-specific advantages, country-choice and entry mode in reverse takeovers are unveiled.     

Asymmetric roles of business ties and political ties in product innovation

This study investigates the asymmetric roles of business ties and political ties in innovation processes. The study posits that business ties strengthen organizational competence and enhance the environmental fit. In contrast, political ties increase the environmental fit but ossify organizational internal routines. The study uses an extensive survey on 766 Chinese firms across multiple sectors to test hypotheses. The empirical results provide strong supports for hypotheses by showing that: (1) business ties have a positive impact on product innovation, indicating that despite different types of business ties, they share common features in enhancing product innovation; (2) political ties have an inverted U-shaped relationship with product innovation, indicating that the positive effect of political ties on product innovation would diminish as the costs of political ties outweigh the benefits.     

商业模式创新视角下的现代服务业发展分析研究——以宜信集团为例

在竞争激烈的市场经济时代,商业模式之争已成为企业取胜市场的关键;商业模式创新作为实现可持续竞争优势的最佳途径,也已成为新的竞争焦点和学者研究的热点。本人通过文献回顾来构建自己的理论框架以及阐述商业模式创新理念的内涵,并通过对宜信集团商业模式的案例研究得出相关结论,最后概述我国现代服务业的发展前景。     

Assessing contribution of research in business to practice

This editorial offers some thoughts on wider criteria of evaluation than journal and article impact metrics. The editorial suggests that the measurement of journal and article impact metrics simply confirms the status quo rather than the promotion of resonance between practice, research and theory. The editorial proposes a more holistic recognition of impact, influence and usefulness that elevates the importance of three further dimensions of application, context and involvement. The editorial considers the value of scientific research to business practitioners and students concluding that an ingenuous and on-going scheme of exchange between scholars and practitioners would lead to cross-fertilization of ideas and experience and enhance empathy, learning and understanding. The alternative pursuit of scientific “respectability” by scholars in the most myopic academic sense has become less and less useful to students as well as the business community leaving the suspicion of business schools obsessed with making money whilst pretending to pursue knowledge and produce future citizens to make the world a better place.     

Spillovers through backward linkages and the export performance of business services. Evidence from a sample of Italian firms

We provide evidence on the role of spillovers through vertical linkages in service firms’ internationalisation process. We combine input–output coefficients with region-level information on downstream manufacturing sector exports to build a measure of spillovers through backward linkages, which we assess as a systematic determinant of Italian BS firms’ export status. Once considered firm and sector specificities, export spillovers especially matter for exporting to high-income economies outside Europe. This finding originates from higher sunk costs stemming from greater distance to the destination market and tougher competition within the destination market. Furthermore, the spillovers’ geographical scope is mainly local. We thus contribute to international business theory by generalising existing evidence from case studies on the importance of buyer–supplier relationships for service firms’ internationalisation across several BS sectors. Our research carries important implications for international business practices as well, as joining networks with internationalised customers may play an important role in enhancing BS firms’ exports, regardless of the BS supplied.     

Changing the game to compete: Innovations in the fashion retail industry from the disruptive business model

Unprecedented competition and emergent technologies have posed a challenge to many traditional retailers in recent years. Yet within this competitive environment, emerging innovative business models have thrived and successfully disrupted the industry. We analyze the nature of disruptive business-model innovations and the ways they disrupt the fashion retail industry. To that end, we examine three disruptors in the industry: born-digital brands, AI-enabled demand forecasting and product design, and collaborative consumption. After introducing the concept of disruptive business-model innovation, we discuss the three disruptors’ effects on the fashion industry. We find that all of these models keenly answer fundamental needs unmet by current business models, such as offering quality products at a competitive price, curated services, and sustainable consumption. At the same time, all three disruptors suggest effective operation models for handling demand uncertainty, inventory management, and timely responses to the market, all of which are inherent issues for current push supply chains and forecast-based, inventory-driven systems. Based on this analysis, we discuss important implications for both academics and industry practitioners.     

The development of critical capabilities in foreign subsidiaries: disentangling the role of the subsidiary’s business network

Within business literature in general, capabilities have advanced to the prime determinant of the corporation’s economic rents. Within international business literature, it is further assumed that multinational corporations can enhance their pool of capabilities through foreign subsidiaries. Foreign subsidiaries are seen as means to assimilate new capabilities from their local, external network and integrate these capabilities into the multinational corporation. Data from more than 2000 foreign subsidiaries shows that some foreign units actually are endowed with superior capabilities which are useful for other corporate entities. It is argued that the development of critical capabilities within these subsidiaries is driven not only by internal corporate actors, but also by external actors. The analysis provides evidence that the role of different internal and external network partners for capability development varies according to the functional activity under consideration. Thus, subsidiaries benefit from various internal and external network actors in very different ways. The contribution ends with some conclusions and some avenues for future research.