Globalization and profitability of cross-border mergers and acquisitions

This paper studies how the surplus generated by the globalization process is divided between MNEs and owners of domestic assets. We construct an oligopoly model where the equilibrium acquisition pattern, the acquisition price and firms’ greenfield investments are endogenously determined. Acquisition entry is shown to be more likely when the complementarity between domestic and foreign assets is high. However, we show that such acquisitions might have a low profitability, since the bidding competition over the domestic assets is then so fierce that the firms involved would be better off not starting a bidding war. Risks associated with different entry modes are also examined.     

Evaluation of a home injury prevention program in a WHO Safe Community

The objective of this study was to evaluate the effect of a community-based injury prevention program on home injuries. Unintentional injuries occurring in private homes and during leisure time account for 70-80% of injuries treated in public health care. A quasiexperimental design was used for the study, with cross-sectional preand post-implementation measurements in the program area and in a neighboring control community. Children and the elderly were two main target groups of the intervention program, which was based on a participative strategy for community involvement. The study was based on defined total populations. The total relative risk for home injury occurrence decreased in the study area, whereas it increased in the control area. Regarding age and gender, there was a decrease for females and males in the study area and a slight increase in the control area. For males, the youngest and oldest age groups showed no decrease, whereas females showed a decrease among the youngest and those aged 60-79. No decrease was observed in the control area. The study showed that the Safe Community approach had a general effect on the incidence of home injuries.     

Cross-Border Mergers & Acquisitions Policy in Service Markets

We provide facts showing that in service markets: (i) restrictions on foreign direct investment (FDI) are under reform, (ii) cross-border Mergers & Acquisitions dominate as the entry mode of FDI, and (iii) there is often a high market concentration. Based on these facts, we present a model for analyzing cross-border merger and acquisition policy in liberalized service markets taking into account efficiency and market power effects. Our findings suggest that a merger policy, but not a discriminatory policy towards foreigners, seems warranted. Moreover, policies ensuring competition for domestic target firms seem warranted. In this vein, harmonization of the EU takeover regulations may particularly benefit assets owners in countries with many target firms.     

How do MNCs establish their talent pools? Influences on individuals’ likelihood of being labeled as talent

Addressing the research question of what influences the likelihood of an individual being labeled as ‘talent’ in MNCs, this paper seeks to understand the decision processes involved in the identification of MNC-internal talent. We develop a framework suggesting that the decision to include an employee in a corporate talent pool is a two-stage decision process in which mostly experience-based (on-line) performance appraisal evaluations are used as an input in largely cognition-based (off-line) managerial decision making. Consequently, talent pool inclusion is determined not only by performance appraisal evaluations, but also a number of factors that influence the decision making in the second stage of the talent identification process. Using empirical insights from an in-depth case study as illustrations, we identify three such factors—cultural and institutional distance between the locations of a potential member of the talent pool and the decision makers; homophily between the individual and the decision makers; and the network position of the person in question.     

Management regimes in science-based innovation: control and uncertainty during early phases of new drug development

The international pharmaceutical industry is facing a challenge in terms of being able to deliver new and innovative drugs at lower cost. During the last 10 years, a range of new scientific procedures and technologies has been introduced into the industry, partially derived from the advancement of genomics research. However, to date, few have resulted in new registered drugs. In addition to the new technologies, various managerial techniques and methods have been introduced with the intention of increasing the transparency of operations. This paper reports on a study of how scientists during the early phases of new drug development conceive of this present management regime emphasising quantitative output. Thinking of new drug development as an intellectual pursuit in order to understand the elementary mechanisms of the biological organisms on the molecular level, scientists call for an understanding and adjustment of the managerial techniques structuring this work, accompanied by ambiguities and uncertainty.     

An Integrative HRM Process Theorization: Beyond Signalling Effects and Mutual Gains

How and for whom HRM creates value are key questions in management research. The present study develops and tests an integrative HRM process theorization positing the existence of mutually reinforcing ability–motivation–opportunity, signalling, and identity‐based control mechanisms of the influence of HRM on both employee performance and work intensification. In addition to providing empirical support for the ‘how’ of value creation through HRM, the study contributes to the growing critique of the dominant mutual‐gains perspective, the notion that HRM outcomes are straightforwardly positive for both employers and employees. The integrative theorization also opens up interesting avenues for future research on the individual and organizational performance effects of HRM.     

The duration of trade revisited

The recent literature on the duration of trade has predominantly analyzed the determinants of trade flow durations using Cox proportional hazards models. The purpose of this article is to show why it is inappropriate to analyze the duration of trade with continuous-time models such as the Cox model, and to propose alternative discrete-time models which are more suitable for estimation. In brief, the Cox model has three major drawbacks when applied to large trade data sets. First, it faces problems in the presence of many tied duration times, leading to biased coefficient estimates and standard errors. Second, it is difficult to properly control for unobserved heterogeneity, which can lead to parameter bias and bias in the estimated survivor function. Third, the Cox model imposes the restrictive and empirically questionable assumption of proportional hazards. In contrast, with discrete-time models there is no problem handling ties; unobserved heterogeneity can be controlled for without difficulty; and the restrictive proportional hazards assumption can easily be bypassed. By replicating an influential study by Besede? and Prusa (J Int Econ 70:339?C358, 2006b), but employing discrete-time models as well as the original Cox model, we find empirical support for each of these arguments against the Cox model. Moreover, when comparing estimation results obtained from a Cox model and our preferred discrete-time specification, we find significant differences in both the predicted survivor functions and the estimated effects of explanatory variables on the hazard. In other words, the choice between models affects the economic conclusions that can be drawn.     

The impact of advanced vocational education and training on earnings in Sweden

Researchers have established a relationship between greater education and training and higher earnings but it is difficult to infer that the former causes the latter if those with higher earnings tend to engage in more education and training. The present study attempts to control for ability and family background to see if stronger inferences can be made about education and training as the independent variable. The study focuses upon advanced vocational education and training (AVET) in Sweden. This is post‐secondary school education for individuals who are 20 years of age or older. The aim of this article is to estimate the effects of AVET on earnings by controlling for selection bias. We used various approaches such as instrumental variables, Hausman–Taylor estimates, fixed effects estimates and propensity score matching to achieve this aim. A panel, or longitudinal, data set for eight different labor markets in Sweden for the period 1996–2008 was used. The results indicate that earnings from AVET are higher than the return on investment in comprehensive education. The average effect on income is estimated to be in the range of 3–8 percent.     

Social Indentity And The Problem of Loyalty In Knowledge-Intensive Companies

This paper treats the significance of organization-based social identity for loyalty versus exit reactions with special reference to knowledge-intensive companies. The centrality of network relations and close contact with clients in combination with the sometimes drastic consequences of knowledge workers defecting in many knowledge-intensive companies makes social identification and loyalty crucial themes for management. The paper discusses different kinds of and modes of accomplishing loyalty and also addresses post-exit management, how companies may deal with employees that have left the company.     

Book review

Although best practice transfer methodologies have become an increasingly common instrument in enterprise policy development, barriers to the exchange and dissemination of knowledge may limit their effectiveness. Using START, an EC-funded network of regional agencies, as a case this paper explores the dynamics of experience exchange in regional enterprise policy. Working closely with the START partnership, the authors developed a detailed account of how the network communicated and disseminated cases and instances of regional start-up policy and practice between themselves. Partners in START were more likely to adapt abstracted principles, concepts and ideas that informed changes to their own practices than to adopt specific initiatives from other regions. This suggests a need to re-focus best practice transfer methodologies away from the transplantation of established practices towards encouraging interactive and collaborative learning based on the sharing of experience.