International Business & Trade Samenvatting (Articles, lectures, and tutorial lectures).
27 views 4 purchases
Course
International Business and Trade (MANMEC051)
Institution
Radboud Universiteit Nijmegen (RU)
This document highlights all the articles, lectures, and paper meetings of the masters course International Business & Trade (MAN-MEC051). Each article consists of a list of relevant definitions, a summary of the article, results, and implications of the results.
Good luck!
Business Administration: Business Administration / International Business Administration
International Business and Trade (MANMEC051)
All documents for this subject (1)
Seller
Follow
douweeverink1
Content preview
International Business & Trade (MAN-
MEC051)
Table of contents
Lecture 1: Introduction................................................................................................................................... 3
Case study: Establishing Honda of America.........................................................................................................3
Lecture 1: Introduction.........................................................................................................................................5
Lecture 2: World trade and the international trading system..........................................................................7
Article: The Political Economy of the World Trading System (Hoekman & Kostecki, 2001).................................7
Article: The World Trade Organization and the Future of Multilateralism (Baldwin, 2016)................................9
Article: The world trading system: an overview (Bagwell et al., 2016)..............................................................11
Article: The evolution of PTAs: stylized facts (WTO, 2011).................................................................................14
Article: The standard economics of PTAs (WTO, 2011)......................................................................................16
Lecture 2.............................................................................................................................................................19
Tutorial lecture...................................................................................................................................................24
Lecture 3: Firms and international trade....................................................................................................... 25
Article: What you should know about globalization and the World Trade Organization (Deardorff et al., 2002)
............................................................................................................................................................................25
Article: Gains from Trade when Firms Matter (Melitz et al., 2012)...................................................................28
Article: Implications of global value chains for trade policy (OECD, 2013)........................................................30
Lecture 3.............................................................................................................................................................33
Tutorial meeting.................................................................................................................................................39
Lecture 4: The why of different forms of border-crossing business activities..................................................41
Article: The key literature on IB activities: 1960-2006 (Dunning, 2008)............................................................41
Article: The eclectic paradigm as an envelope for economic and business theories of MNE activity (Dunning,
2000)..................................................................................................................................................................43
Article: John Dunning’s eclectic model and the beginnings of global strategy (Tallman, 2003)........................45
Article: Theories of the multinational enterprise (Hennart, 2001).....................................................................47
Lecture 4.............................................................................................................................................................49
Tutorial 4............................................................................................................................................................52
Lecture 5: The where and how of foreign direct investment..........................................................................54
Article: Lincoln Electric’s Harsh Lessons from International Expansion (Hastings, 1999)..................................54
Article: Location choice research: Proposing new agenda (Jain et al., 2016)....................................................56
Article: Boundaries of the firm: insights from international entry mode research (Brouthers & Hennart, 2007)
............................................................................................................................................................................60
Article: International establishment mode choice: past, present, and future (Dikova & Brouthers, 2016).......63
Article: Reshoring manufacturing: coming home (The Economist, 2013)..........................................................66
Paper meeting 1: The (non-) death of distance.............................................................................................75
Article: Has distance died? Evidence from a panel gravity model (Brun et al., 2005).......................................75
Article: There goes gravity: eBay and the death of distance (Lendle et al., 2016).............................................78
Paper meeting 2: Country risks, policy uncertainty, and international investment/divestment......................80
Article: Multinationals’ response to major disasters: how does subsidiary investment vary in response to the
type of disaster and the quality of country governance (Oh & Oetzel, 2011)....................................................80
Article: The impact of EU preferential trade agreements on Foreign Direct Investment (Cadramone &
Scoppola, 2012)..................................................................................................................................................82
Paper meeting 3: Exploiting country dissimilarities.......................................................................................85
Article: Stakeholder pressure on MNEs and the transfer of socially irresponsible practices to subsidiaries
(Surroca et al., 2013)..........................................................................................................................................85
Article: The determinants of tax haven FDI (Jones & Temouri, 2016)................................................................88
2
,Lecture 1: Introduction
Case study: Establishing Honda of America
Systematic analysis
1. What motivated Honda’s decision to establish HAM?
Honda’s decision to establish Honda of America Manufacturing (HAM) was motivated by the
need to enter the American market more effectively. Honda wanted to reduce its reliance on
exports from Japan to the US and overcome the trade barriers and currency exchange rate
risks associated with international trade. Establishing local manufacturing in the US allowed
Honda to be more responsive to the American market’s demands, reduce costs, and gain
competitive advantage.
2. What role did location play in Honda’s decision?
The choice of Ohio as the location for the manufacturing plant was influenced by factors such
as the availability of a skilled and motivated labor force, access to expressways and railroads,
and a level lot covering the required acreage. Ohio’s central location in the US made it an
ideal hub for producing and distributing Honda’s automobiles. Additionally, the state’s
governor, James Rhodes, provided strong support emphasizing the importance of location in
the decision-making process.
3. What are the specific competencies owned by Honda?
Honda possesses several specific competencies, including:
- Expertise in manufacturing high-quality automobiles and motorcycles.
- Strong commitment to quality control and continuous improvement in production
processes.
- Ability to adapt and transfer its manufacturing philosophy and operational outlook to
foreign operations.
- Effective management of its supply chain and development of relationships with local
parts suppliers.
4. What (foreign) activities does Honda do internally and what activities are
outsourced?
Internalization: Honda internalizes key manufacturing and quality control activities, such as
the production of automobiles, motorcycles, and engines. These core manufacturing
processes are conducted internally to ensure quality standards are met.
Outsourced: activities related to parts and components supply.
Motives for FDI and the so-called OLI paradigm
5. What could be some motives for a firm to establish foreign operations?
Tariff-jumping: when a firm invests in local production in a foreign market to jump a tariff on
cross-border exports to the market. One motive for Honda’s FDI could be to avoid high
import tariffs and trade barriers imposed on vehicles and components. By producing locally
in the US, Honda could reduce or eliminate the need to pay tariffs on imported vehicles and
parts.
3
, Internalize exchange rate risks: Honda’s decision to establish manufacturing in the US can
also be seen as a strategy to internalize exchange rate risks. By producing in the local
currency (USD), Honda reduces its exposure to currency fluctuations when selling its
products in the US market.
6. What are the O’s, L’s, and I’s in the Honda case?
Ownership: Honda’s ownership advantage lies in its expertise in manufacturing high-quality
automobiles and motorcycles. This advantage allows them to maintain control over their
production processes and product quality.
Location: the location advantage is represented by Honda’s choice of Ohio as the
manufacturing sited. Ohio’s central location in the US, access to transportation
infrastructure, and availability of a skilled workforce provide location-based advantages.
Internalization: Honda’s decision to establish local manufacturing facilities in the US
represents the internalization of production processes to reduce trade barriers, tariffs, and
exchange rate risks while serving the American market. This internalization allows Honda to
maintain control over its manufacturing operations.
4
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller douweeverink1. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $7.18. You're not tied to anything after your purchase.
