Internationalization of industry : an assessment in the light of a small open economy (Switzerland)

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Internationalization of industry : an assessment in the light of a small open economy (Switzerland)

Silvio Borner

Springer-Verlag, c1986

  • :U.S.
  • :G.W.

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Bibliography: p. [157]-172

Description and Table of Contents

Description

About 10 years ago, the first very small steps towards this book were taken. The starting point was marked by the deep and sudden slump of the Swiss economy in the mid-seventies: a crisis wiping out about 10 percentage points of GNP and employment within just two years. To this writer, it was clear from the beginning that neither the exogenous shocks nor the struc- tural changes were in fact exogenous or structural. They were given and sha- ped by global forces. They were part and parcel of capitalist development. There is no other highly developed country in the world which is so ex- tremely and integrally exposed to world-wide currents of financial and economic changes as Switzerland. The degree and dimensions of open- ness ofthe Swiss economy led to the formulation of our research approach for studying the internationalization of the economy, a topic theoretically and politically developed in this book. Empirical evidence relates to our study of Swiss experience. A well-known Swiss-American economist offered the following com- ment on our previous work on the internationalization of industry: "You are very good in raising interesting questions ..." What was undoubtedly meant as a criticism was received as a compliment. Too much talent and too many research efforts are, in my opinion, wasted by research programs which place technique over substance. This unfortunate development in our profession has already greatly reduced the social utility of economists.

Table of Contents

I. Interdependency Through Internationalization in an Historical and Global Perspective.- 1 The "International Disorder": Some Historical Digressions on the Structure of Global Interdependencies.- 2 Dimensions and Perspectives of Interdependence: Exports, Multinationals, and New Forms of Internationalization.- 2.1 Introduction.- 2.2 The Trade View: Exports and Imports.- 2.3 The Perspective of Foreign Direct Investment.- 2.4 The Entrepreneurial View: New Forms of Internationalization.- 2.5 Opportunities for New Forms of Internationalization in the Future.- 3 Global Forces Behind New Forms of Internationalization.- 3.1 The Displacement of Global Industrial Dynamics.- 3.2 Revolution in Information, Communication, Transportation, and Production Technologies and their Rapid International Diffusion.- 3.3 A Speed-Up of Structural Adjustment Processes with Adverse Effects on the Traditional Industrial Countries.- 3.4 The World Debt Problem and New Forms of Internationalization.- 4 The Structural Adjustment Problems of the National Economy: Views on the "Competitiveness Debate" of Swiss Executives.- II. A Taxonomy of New Forms of International Investment and Export Financing.- 5 New Forms of International Investment.- 5.1 Licensing.- 5.2 Sub-Contracting.- 5.3 Consulting.- 5.4 Contractual Cooperation.- 5.5 Joint Ventures.- 5.6 Group Investment.- 6 New Forms of Export Financing.- 6.1 Barter.- 6.1.1 Classical or "Pure" Barter.- 6.1.2 Barter with Contractual Participation of a Third Party.- 6.1.3 Parallel Barter.- 6.1.4 Triangular Barter.- 6.2 Long-term Commercial Framework Agreements.- 6.3 Counterdelivery.- 6.4 Offset.- 6.5 Junktim.- 6.6 Turnkey.- 6.7 Buy-Back.- III. Economic Theory and New Forms of Internationalization: Toward the Synthesis of a General Model.- 7 Introduction: Synopsis of Theoretical Development with Regard to Trade, Foreign Direct Investment (FDI), and New Forms of Internationalization (NFI).- 8 The Transaction Cost Approach to New Forms of International Investment (NFII).- 8.1 Introduction.- 8.2 NFII in the Categories of Internationalization Theory.- 8.3 Critical Review of Orthodox Internalization Theory.- 8.4 Attempts to Integrate NFII into a Theoretical Framework.- 9 The Transaction Cost Approach to New Forms of Export Financing (NFEF).- 9.1 Introduction.- 9.2 Transaction Costs and Risks as Determinants of Exchange Systems:the Niehans Model.- 9.3 Tariffs, Subsidies, and Deficient Market Transparency as the Determinants of Countertrade.- 9.3.1 Countertrade in Situations of Bilateral Monopoly.- 9.3.2 Countertrade as a Rational Strategy for Combatting a Lack of Market Transparency.- 9.3.2.1 The Invisible Handshake: Okun's Theory of Implicit Contracts as Applied to Countertrade.- 9.3.2.2 Countertrade as a Reaction to a Lack of Market Signals on World Markets.- 10 Competitive Advantage and Technological Change from the Strategic Perspective of the Firm.- IV. Empirical Research on the Impact of New Forms of Internationalization on Swiss Industry.- 11 Empirical Research Concept and Data Base of Our Swiss Study.- 11.1 Empirical Research Concept.- 11.2 DataBase.- 12 Case Study Results.- 12.1 Case Studies of New Forms of International Investment (NFII).- 12.1.1 Utilization of New Forms of International Investment and the Branch of Industrial Activity.- 12.1.2 New Forms of International Investment and Technology.- 12.1.3 New Forms of International Investment and Management Structure.- 12.1.4 New Forms of International Investment and Export Activity.- 12.1.5 Market Characteristics of Firms Utilizing New Forms of International Investment.- 12.2 Case Studies on New Forms of Export Financing (NFEF).- 12.2.1 The Chemical Industry.- 12.2.2 The Pharmaceutical Industry.- 12.2.3 The Chemical and Pharmaceutical Industries: the Case of a Multinational Firm.- 13 Results of the Survey on New Forms of International Investment (NFII).- 13.1 An Overview of International Activities.- 13.2 New Forms of International Investment and Traditional Categories of Industrial Analysis.- 13.2.1 New Forms of International Investment and Exports.- 13.2.2 New Forms of International Investment and Foreign Direct Investment.- 13.2.3 New Forms of International Investment and the Size of the Firm.- 13.2.4 New Forms of International Investment and Industrial Branch.- 13.2.5 New Forms of International Investment and Host Countries.- 13.2.6 New Forms of International Investment and the Level of Technology.- 13.3 The Various New Forms of International Investment in our Sample.- 13.4 The Role of New Forms of International Investment in the Future.- 14 Results of the Survey on New Forms of Export Financing (NFEF).- 14.1 Forms of Countertrade: their Frequency.- 14.2 Forms of Countertrade: their Geographical Distribution.- 14.3 Regional Distribution of Various Forms of Countertrade.- 14.4 Countertrade According to the Size of the Firm.- 14.5 Classical Exports Versus New Forms of Export Financing.- 14.6 The Relative Importance of Countertrade in Export Activity.- 14.7 Entrepreneurial Motivation for Export Activity.- 14.7.1 The Motives Behind Export Expansion.- 14.7.2 The Motives Behind Export Contraction.- 14.8 Protectionist Distortions in Foreign Markets Due to Government Assistance of Foreign Competitors.- 14.9 Industry-Specific Forecasts of Countertrade.- 14.10 Insurance and Risk-Taking: Exports Versus Countertrade.- 15 Results of Surveys of Swiss Multinationals.- 15.1 Foreign Employment, FDI, and International Production by Swiss Multinationals.- 15.2 New Forms of International Investment by Swiss Multinationals.- V. Synthesis: Conclusions and Recommendations for Economic Policy and Business Strategy.- 16 A Framework for the Evaluation of New Forms of Internationalization (NFI).- 16.1 Perspectives and Interests of the Various Actors.- 16.2 A Measuring Rod for the Efficiency and Equity of New Forms of Internationalization.- 16.3 The Main Elements of a Framework for Evaluation.- 17 Recommendations for Private Business Strategies.- 17.1 New Forms of Internationalization: the Link Between Global Disintegration and the International Operations of Firms.- 17.2 A Strategic Concept for New Forms of Internationalization.- 17.3 The Choice between Exports, New Forms of Export Financing, and New Forms of International Investment.- 18 Recommendations for Economic Policies at the National and International Levels.- 18.1 Internationalization of Industry and the Sovereignty of the Nation State.- 18.2 The Choice of a National Strategy.- 18.3 Foreign Trade Policy and New Forms of Internationalization.- 18.4 Democratic Corporatism and Swiss Domestic Policy.- References.

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