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Inward Investment and the Construction of New Production Spaces: The Case of Telford

Tony Elger and Chris Smith

in Assembling Work: Remaking Factory Regimes in Japanese Multinationals in Britain

This chapter examines the construction of new production spaces for foreign firms through the clustering of inward investment within one locality. It examines the roles of pre-existing institutional ... More

This chapter examines the construction of new production spaces for foreign firms through the clustering of inward investment within one locality. It examines the roles of pre-existing institutional legacies, national and local state policies, individual enterprise strategies, and the responses of trade unions and workers in the construction and reconstruction of one such production space at Telford in the English Midlands, the town with the highest concentration of Japanese investment in Britain. Close and cooperative relationships between Japanese firms have helped to set ‘the rules of the game’ for many aspects of worker-management relations, including union avoidance, making the cluster and the locality key influences on internal factory regimes. This has reinforced an emphasis on lowly paid machining and assembly work, but managers have still faced important constraints and challenges on these greenfield sites. This is the setting for most of the case-study subsidiaries discussed in the book.Less

Foreign Firms and Local Communities 

Bruce Blonigen and Cheyney O’Fallon

in Firms in the International Economy: Firm Heterogeneity Meets International Business

The authors argue that both IE and IB have overlooked the relation between foreign firms and local communities. They show, inter alia, that foreign- owned firms differ substantially from domestically ... More

The authors argue that both IE and IB have overlooked the relation between foreign firms and local communities. They show, inter alia, that foreign- owned firms differ substantially from domestically owned firms in their local philanthropy: foreign firms give less.Less

Beyond Multinationals: The Environmental Behavior of Foreign Firms in China

in Foreign Firms, Investment, and Environmental Regulation in the People's Republic of China

This chapter examines the environmental behavior of foreign firms in China based on the results of a survey conducted in Jiangsu Province during the fall of 2005. It argues that foreign-invested ... More

This chapter examines the environmental behavior of foreign firms in China based on the results of a survey conducted in Jiangsu Province during the fall of 2005. It argues that foreign-invested enterprises, particularly those which are foreign-controlled, display better environmental behavior than domestic firms and are often “beyond compliance” in their environmental behavior. The analysis reveals that foreign firms are indistinguishable from domestic enterprises in terms of their environmental behavior and that, from the perspective of firm strategy and practice, there is little evidence for a widespread pollution-haven phenomenon in China.Less

Economic Patriotism, Foreign Takeovers, and National Champions

Jens Suedekum

in Industrial Policy for National Champions

In this chapter the author turns to a model that reflects on the competition between domestic and foreign firms, which produce differentiated commodities, in the domestic market. There are two ... More

In this chapter the author turns to a model that reflects on the competition between domestic and foreign firms, which produce differentiated commodities, in the domestic market. There are two domestic firms and one foreign firm that compete in Bertrand fashion. The model, which also measures economic patriotism, presents a scenario where there can either be a domestic merger that creates a national champion or an acquisition of one of the domestic firms by a competent foreign rival. Growth of the national champions or foreign enterprises in equal balance depends on the level of trade openness and the attitude of the government. If the government is open and not biased against foreign takeover of the national firms, it is possible that globalization would make it possible for the foreign firm to acquire the national firm. Cross-border mergers are possible in the event of trade integration.Less

Local Policy Making, Globalized Coalitions, and Resource Allocation

Ling Chen and Ling Chen

in Manipulating Globalization: The Influence of Bureaucrats on Business in China

This chapter delves into the coalitional politics of policy making and resource allocation by investigating strategies of city government officials. The chapter examines the patterns of bureaucratic ... More

This chapter delves into the coalitional politics of policy making and resource allocation by investigating strategies of city government officials. The chapter examines the patterns of bureaucratic competition between international commerce departments and newly emerged domestic technology departments and their respective business clients, including foreign and domestic firms. I explain the influence of FDI attraction on domestic politics by showing (1) how the overlap between FIEs and exporters shaped the degree of perceived threat and the cohesiveness of the vested interests in international commerce under the rule of fragmented bureaucratic competition and (2) how the existence of large foreign firms strengthened the bargaining power of the vested interest bureaucrats against allocating resources to the domestic technology coalition. The direction and the magnitude of foreign influence, therefore, is filtered and channeled through local bureaucracy.Less

Heterogeneous Export Spillovers to Chinese Domestic Firms: The Role of the Difficulty to Enter the Destination Market

Florian Mayneris and Sandra Poncet

in Firms in the International Economy: Firm Heterogeneity Meets International Business

The authors show that domestic firms can benefit from the local presence of foreign exporting firms. This illustrated for Chinese firms.

Greening Foreign Investment: China's Legal Framework

in Foreign Firms, Investment, and Environmental Regulation in the People's Republic of China

This chapter explores the legal and regulatory framework that polices the environmental protection aspects of foreign direct investment (FDI) in China. It describes how the legal regime governing ... More

This chapter explores the legal and regulatory framework that polices the environmental protection aspects of foreign direct investment (FDI) in China. It describes how the legal regime governing environmental aspects of FDI has developed over time and investigates how the Chinese central government responded to the need to regulate the environmental behavior of foreign firms. The analysis indicates that China has made steady progress in its governance of FDI, with momentum gathering particularly in the latter half of the 1990s, and that there is little evidence that the quest for FDI is turning China into a pollution haven.Less

The British Banking Industry

Jordi Canals

in Competitive Strategies in European Banking

This chapter provides a structural overview of the British financial system. It notes that the UK has a long tradition as a premier financial centre and that this is a result not only of British ... More

This chapter provides a structural overview of the British financial system. It notes that the UK has a long tradition as a premier financial centre and that this is a result not only of British political leadership at the international level in the nineteenth century, but also of the liberal approach to financial regulation. However, the chapter notes that the downturn of the economy and the rise of other international financial centres have caused London to lose some of its prominence. It indicates that the financial industry's importance to the British economy is the financial institutions' contribution to foreign exchange revenue in the balance of payments, and points out that the strong presence of foreign firms has unquestionably contributed to London's role as an international financial centre.Less

Conclusions: Business in China—The Evolution of Laws and the Market

Linda Yueh

in Enterprising China: Business, Economic, and Legal Developments since 1979

This chapter examines whether the corporate laws that transformed Chinese enterprises into shareholding corporations have mattered in generating improvements in firm performance. It reviews the ... More

This chapter examines whether the corporate laws that transformed Chinese enterprises into shareholding corporations have mattered in generating improvements in firm performance. It reviews the business environment in China after years of reform and how it is likely to evolve. The differing regimes for state-owned enterprises (SOEs) and Chinese private and foreign firms remain in some forms, but China is moving toward a unified rule of law system to govern its increasingly decentralized and marketized economy.Less

To Go Green Is Glorious? China, Foreign Investment, and Environmental Regulation

in Foreign Firms, Investment, and Environmental Regulation in the People's Republic of China

This introductory chapter discusses the theme of this book, which is about the impact of foreign direct investment on environmental regulation in China, and explains that China is both heavily ... More

This introductory chapter discusses the theme of this book, which is about the impact of foreign direct investment on environmental regulation in China, and explains that China is both heavily foreign-invested and polluted, and that the pollution is the result of industrial production. The book examines the development of Chinese law that regulates firm activity and controls the environmental impact of foreign direct investment, and investigates the extent to which foreign investment contributes to and undermines China's environmental regulation. It also evaluates competing assertions about the impact of foreign-firm investment on the process of environmental regulation.Less

Regulatory Hostage-taking and Shaming

Angela Huyue Zhang

in Chinese Antitrust Exceptionalism: How The Rise of China Challenges Global Regulation

This chapter examines the myth behind the paucity of appeals against antitrust agencies in China. The primary reason holding businesses back from defying Chinese antitrust authorities is not ... More

This chapter examines the myth behind the paucity of appeals against antitrust agencies in China. The primary reason holding businesses back from defying Chinese antitrust authorities is not necessarily the perceived low probability of success in a Chinese court but rather the high transaction costs associated with such an appeal. Chinese antitrust authorities possess wide discretion over enforcement and can proactively apply it to entire firms to settle the cases. Firms operating in China, whether foreign or domestic, are likely to continue to interact with these agencies and their host ministries in the future. Businesses therefore avoid taking an aggressive and adversarial approach for fear of future retribution. In addition, Chinese government agencies are adept at using media strategies during enforcement. In several high-profile cases, the antitrust bureau at the National Development and Reform Commission (NDRC) deftly mobilized public sentiments through the state media, strategically shaming to prevent defiance of their orders, and relentlessly suppressing experts from voicing opinions that might threaten the legitimacy of its measures. In so doing, the NDRC was able to overcome its capacity and bureaucratic constraints, thereby quickly cementing its reputation as an astute and forceful regulator.Less