Subsidiary-specific advantages for inter-regional expansion: The role of intermediate units

This paper explores the distinctive deployment of resources and capabilities by subsidiaries in order to develop an intermediate role within the MNC. Based on the regional management perspective, we focus on a specific intermediate role—the springboard subsidiary—that helps overcome the liability of inter-regional foreignness. Our results, which are based on a dataset covering 188 subsidiaries, show that the probability of taking on this role is contingent upon experiential knowledge about the target region, as well as a rich knowledge base derived from a wide range of activities and a broad geographical scope. Our findings also show that possession of slack resources does not necessarily mean that a subsidiary will take on this role, as such slack must be combined with experiential knowledge. This paper serves as a first step in helping MNCs plan resource allocation to handle inter-regional expansion.     

Productivity and efficiency dynamics in Indian banking: An input distance function approach incorporating quality of inputs and outputs

Banking technology is typically characterized by multiple inputs and multiple outputs that are associated with various attributes, such as different types of deposits, loans, number of accounts, classes of employees and location of branches. These quality differentials in inputs and outputs are mostly ignored in empirical studies. These omissions make the practical value of productivity studies in organizations like banks questionable because quality is a key component of performance. This paper proposes using hedonic aggregator functions (as a tool of aggregating inputs and outputs with quality attributes) within an input distance function framework and analyzes the impact of banking deregulation on efficiency and total factor productivity (TFP) change in the Indian banking industry using panel data for the period 1996–2005. Empirical results indicate that banks have improved their efficiency (from 61% in 1996 to 72% in 2005) during the post‐deregulation period, and the gain in efficiency of state‐owned banks has surpassed that of private banks. Improvement in capital base, as indicated by increased capital adequacy ratio, played an important role in ushering efficiency gain. The return to scale estimate suggests that state‐owned banks are operating far above their efficient scale and cost savings can be obtained by reducing their size of operations. Overall, TFP growth was above 3.5% annually. Both technical progress and technical efficiency change consistently played an important role in shaping TFP growth. Copyright © 2010 John Wiley & Sons, Ltd.     

GLOBALISATION: PAST AND PRESENT

This article compares and contrasts the two modern eras of globalisation, namely the one that started in the mid-nineteenth century and ended on the eve of World War I, and the contemporary era. Although in both periods globalisation brought down national barriers and integrated economies and societies, there were distinct characteristic features of both periods. For example, the scale of global integration through trade and financial channels during the contemporary era was unmatched by the previous phase of globalisation. Furthermore, never in history had global integration involved so many countries and people, both in absolute numbers and as a percentage of the global population.     

Fiscal consolidation with high growth: A policy simulation model for India

In this paper a fiscal consolidation program for India has been presented based on a policy simulation model that enables us to examine the macroeconomic implications of alternative fiscal strategies, given certain assumptions about other macro policy choices and relevant exogenous factors. The model is then used to estimate the outcomes resulting from a possible strategy of fiscal consolidation in the base case. The exercise shows that it is possible to have fiscal consolidation while at the same time maintaining high GDP growth of around 8% or so. The strategy is to gradually bring down the revenue deficit to zero by 2014–15, while allowing a combined fiscal deficit for centre plus states of about 6% of GDP. This provides the space for substantial government capital expenditure, which translates to a significant public investment program. This in turn leads to high overall investment directly and indirectly, via the crowding in effect on private investment, which drives the high GDP growth. The exercise has also tested the robustness of this strategy under two alternative scenarios of higher and lower advanced country growth compared to the base case.     

On someE-optimal block designs

Summary TheE-optimality of block designs is the concern of this paper. Bounds for the smallest positive eigenvalue of theC-matrix of block designs are obtained in some general classes of connected designs with equal or unequal block sizes. Use of these bounds is made to obtainE-optimal block designs in various classes.     

Interpartner Legitimacy in the Alliance Development Process*

abstract We propose a framework to understand interpartner legitimacy in strategic alliances. Interpartner legitimacy is the mutual acknowledgment by the alliance partners that their actions are proper in the developmental processes of the alliance. We argue that interpartner legitimacy is needed for cooperation to achieve alliance objectives. We propose three types of interpartner legitimacy – pragmatic, moral, and cognitive legitimacy – and discuss the dynamics of these three types in the formation, operation, and outcome stages of alliance development. Further, we discuss the salience of interpartner legitimacy in different alliance types. Finally, we derive propositions for further research, and discuss strategies that alliance managers can adopt to develop interpartner legitimacy.     

Analysis of marginally specified semi-nonparametric models for clustered binary data

Generalized linear mixed models are widely used for analyzing clustered data. If the primary interest is in regression parameters, one can proceed alternatively, through the marginal mean model approach. In the present study, a joint model consisting of a marginal mean model and a cluster-specific conditional mean model is considered. This model is useful when both time-independent and time-dependent covariates are available. Furthermore our model is semi-parametric, as we assume a flexible, smooth semi-nonparametric density of the cluster-specific effects. This semi-nonparametric density-based approach outperforms the approach based on normality assumption with respect to some important features of 'between-cluster variation'. We employ a full likelihood-based approach and apply the Monte Carlo EM algorithm to analyze the model. A simulation study is carried out to demonstrate the consistency of the approach. Finally, we apply this to a study of long-term illness data.     

Reassessing Conditional Cash Transfer Programs

During the past decade, the use of conditional cash transferprograms to increase investment in human capital has generatedconsiderable excitement in both research and policy forums.This article surveys the existing literature, which suggeststhat most conditional cash transfer programs are used for essentiallyone of two purposes: restoring efficiency when externalitiesexist or improving equity by targeting resources to poor households.The programs often meet their stated objectives, but in someinstances there is tension between the efficiency and equityobjectives. The overall impact of a program depends on the gainsand losses associated with each objective.      

A Study on the Indian Information Sector: An Experiment with Input-Output Techniques

It is widely recognized that rapid changes in information technology (IT) are bringing about major structural changes in the economies of the world. Information flexibility, product quality and fast response are the key factors for global competition and IT plays a critical role in these areas. Policy-makers in industrialized and developing countries view IT as a critical infrastructure to enhance their access to global knowledge, markets and capital. These views--of IT as infrastructure and as core capability for development--resonate with India's aspirations to modernize its infrastructure, transform its industry and join the global economy. Realizing the huge potential of the Indian IT industry, we make an attempt in this paper to study the extent of informatization in the Indian economy during the period 1983-84 to 1989-90 and try to identify the information intensive sectors. This paper also studies the sources of growth of the information sectors of India during 1983-84 to 1989-90 with the help of a structural decomposition analysis (SDA).