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The international strategies of multinational enterprises are increasingly augmented by insights on, and approaches to, external stakeholders and nonmarket dynamics. The rise of populism and increased geopolitical uncertainty have accelerated these efforts, particularly for business leaders anticipating and engaging external agents, events, and issues that challenge the strategic objectives of their enterprises.

In this paper we explain why the increased preponderance of populism and geopolitical uncertainty are concurrently posing an existential threat to the post-Cold War global economy predicated on free trade and (relatively) open borders and, consequently, challenging the structures and strategies of international business.

We provide an overview of the four papers in our special issue and consider how each advances insights on how multinational enterprises effectively navigate the nonmarket uncertainties of the contemporary global economy. We then advance four important areas for international business research on multinational nonmarket strategies: (i) resilience and legitimacy; (ii), diversification; (iii), market and nonmarket strategy integration; and (iv), institutional arbitrage.

We anticipate that nonmarket strategy scholars can build on these themes to assess how nonmarket strategies can better enable multinational enterprises to survive and thrive in an age of heightened global risk and uncertainty.

This paper and the related special issue provides novel theoretical insights by drawing attention to the relatively under-researched realm of multinational enterprise nonmarket strategy, particularly in populist contexts and during periods of geopolitical uncertainty. Importantly, we identify four promising domains – resilience and legitimacy, diversification, the integration of market and nonmarket strategy, and institutional arbitrage – for international business scholars investigating nonmarket strategy to consider. We anticipate that our paper, as well as other papers in this special issue, contribute further momentum to this burgeoning area of research.

The purpose of this study is to answer the research question: How do cooperative organizations perform when created by government fiat in an emerging market? Through the use of institutional and agency theory, this paper presents a comparative analysis of the efficiency of the cooperative form of organization and investor-owned firms-investigating how the social–political structures in a community affect the efficiency of cooperatives vis-à-vis investor-owned firms. This paper also attempts to offer a better understanding of how government quality and organizational size influence performance outcomes between different organizational forms specifically in the Philippines.

The empirical analysis of this study was conducted among electric distribution utilities in the Philippines. Firm-level data was generated for 133 distributors, consisting of 119 electric cooperatives and 14 investor-owned companies. Panel data regressions were ran to test all hypotheses.

Cooperative organizations operate at a less efficient rate than investor-owned firms in the Philippines, even when controlling for firm-specific factors such as size, customer density and profitability. In addition, the efficiency of these cooperative organizations is more strongly influenced by the quality of the local government than investor-owned firms.

Positive externalities generated by the propagation of cooperatives on local communities may be based primarily on our understanding of how cooperatives have functioned largely in western contexts. Within the context of Southeast Asia, where national socio-political structures may be more dysfunctional, this paper observes that there is an equivalent negative externality caused by the tendency of cooperatives to replicate the political mismanagement of the community around it.

The purpose of this study is to apply the institution-based view and resource dependence theory in arguing that perceived deficiencies in a legal service sector where a foreign subsidiary operates will influence the intensity of its political ties with actors in both the regulatory and legal arenas. The authors further theorized that these relationships will vary across governance environments.

The research context for this study was multinational enterprises (MNE) wholly owned foreign subsidiaries and international joint ventures (IJVs) operating in the Philippines and Thailand. Data for most variables in this study came from primary survey data collected in 2018 from senior managers of MNE WOSs and IJVs operating in the Philippines and Thailand.

The authors’ analysis of 352 foreign subsidiaries operating in the Philippines and Thailand show that, in a flawed democracy, perceived deficient legal services enhance the intensity of foreign subsidiary political ties with government actors in both the regulatory and legal arena. However, in a hybrid regime, perceived deficient legal services enhance only the intensity of foreign subsidiary political ties with government actors in the regulatory arena. The authors’ findings also suggest that the relationship between perceived deficiencies in legal service sector and the intensity of political ties is stronger for foreign subsidiaries that operate in heavily regulated industries across both a flawed democracy and hybrid regime. Conversely, the authors do not find the market orientation of these foreign subsidiaries to play a role in this process.

The authors’ study was unable to control for whether managerial perceptions of deficient legal services were well informed at the local or federal level. This issue raises the question of will the presence of an in-house legal department influence managerial perceptions with regard to deficiencies within a legal service sector? Based on these limitations, the authors suggest that future research can further extend political ties research by using a fine-grained analysis in investigating the antecedents of managerial perceptions of legal services within different legal jurisdictions.

The political ties literature has largely argued that political ties are more prevalent in environmental contexts comprising institutional voids as MNEs attempt to mitigate volatility associated with the lack of developed institutional infrastructure (e.g. Blumentritt & Nigh, 2002; Bucheli et al., 2018). However, the concept of institutional voids is very broad and still rather abstract in nature. Hence, scholars have yet to fully understand what types of institutional voids may drive MNE foreign subsidiary political tie intensity in varying governance contextsThe authors’ study attempts to contribute to this important line of research by investigating how one type of institutional void, namely, perceived deficiencies in the legal service sector, can influence the intensity of political ties in varying governance environments.

The purpose of this paper is to develop a theory based on transaction cost economics to help explain how firms venturing into different foreign markets should properly formulate and implement contractual governance mechanisms to create greater efficiency, lower costs, and minimize conflict with partners.

Defines and discusses a conceptual framework of the determinants regarding contracts and strategies used to manage conflict in foreign ventures through the integration of foreign venture conflict resolution, contract, and transaction cost economics literature.

Suggests that perceived transaction costs will predict which contractual governance mechanism and which conflict resolution strategy a partner firm will choose when resolving conflict in a foreign venture. Postulates that consistency of conflict resolution strategy with contract type will impact the performance of the foreign venture, and that cultural distance, relative power, and interest alignment will all play a moderating role in this process.

The model demonstrates the necessity of examining how coupling certain conflict resolution strategies and contract types will impact foreign venture performance.

The purpose of this paper is to draw from organizational ecology and institutional theory, the authors suggest that there will be a curvilinear relationship between legal system uncertainty and foreign direct investment (FDI) attraction in Southeast Asia. The authors extend theory by arguing that this is because uncertainty will provide opportunities for FDI that seek this form of operating environment, leveraging legal system uncertainty as a basis for competitive advantage.

The authors test and find support for the hypotheses using FDI data from nine Southeast Asian countries for the years 1995-2005.

In this paper, the authors hypothesize and find that the relationship between legal system uncertainty and FDI attraction is curvilinear in nature, such that FDI attraction decreases with legal system uncertainty down to an inflection point, but then increases beyond this point; and that the relationship between legal system uncertainty and FDI attraction is moderated by government intervention in the host country economy, such that the strength of this relationship is greater when government intervention is high rather than when it is low. Implications of the findings and suggestions for future inquiry are presented.

Conventional wisdom suggests that legal system uncertainty will negatively affect FDI attraction. However, to date, research on the effects of legal system uncertainty on FDI attraction in emerging markets has received very little attention. The aim of this research study is to shed new light on how, under certain conditions, legal system uncertainty will attract FDI in Southeast Asia.

The purpose of this study is to investigate how national culture and proximity to national borders can influence the conflict styles that co‐workers use between themselves.

In this experiment, samples were drawn from regions near the US Mexican border further north in the USA and further South in Mexico. Total n=549. Participants were presented with different conflict styles of co‐workers and asked how they would respond. A new measure of national origin was developed and used to assess affinity with a particular culture based on familial lineage.

This study shows that conflict resolution styles of co‐workers in the USA are different from those in Mexico. Culture also moderates the relationship among the conflict resolution styles of the co‐workers themselves. Mexicans were generally more contending and less yielding to co‐workers than Americans. However, Mexicans were also more likely than Americans to respond to contending co‐workers by accommodating or by compromising with the co‐worker. National Origin and border location influenced choice of conflict resolution styles in both American and Mexican workers.

Proximity to national borders can influence degrees of cultural identity, which can in turn, influence preferred conflict styles. Degrees of national cultural identity can be measured using familial lineage.

This paper aims to review the latest management developments across the globe and pinpoint practical implications from cutting-edge research and case studies.

This briefing is prepared by an independent writer who adds their own impartial comments and places the articles in context.

Increase in populism is fueling anti-globalization sentiments and negatively impacting on the investment, expansion and location plans of many multinational enterprises. By focusing on social legitimacy, resilience and institutional arbitrage, such organizations can develop appropriate nonmarket strategies to help alleviate risk and better adapt to the changing business environment.

The briefing saves busy executives and researchers’ hours of reading time by selecting only the very best, most pertinent information and presenting it in a condensed and easy-to-digest format.

Man has been seeking an ideal existence for a very long time. In this existence, justice, love, and peace are no longer words, but actual experiences. How ever, with the American preemptive invasion and occupation of Afghanistan and Iraq and the subsequent prisoner abuse, such an existence seems to be farther and farther away from reality. The purpose of this work is to stop this dangerous trend by promoting justice, love, and peace through a change of the paradigm that is inconsistent with justice, love, and peace. The strong paradigm that created the strong nation like the U.S. and the strong man like George W. Bush have been the culprit, rather than the contributor, of the above three universal ideals. Thus, rather than justice, love, and peace, the strong paradigm resulted in in justice, hatred, and violence. In order to remove these three and related evils, what the world needs in the beginning of the third millenium is the weak paradigm. Through the acceptance of the latter paradigm, the golden mean or middle paradigm can be formulated, which is a synergy of the weak and the strong paradigm. In order to understand properly the meaning of these paradigms, however, some digression appears necessary.

Many multinational corporations that originate from emerging economies (emerging market multinational corporations (EMNCs)) opt for acquiring a target firm in a developed market to expediently upgrade their strategic capabilities. To successfully achieve their strategic goals in the developed markets, EMNCs may use market actions and nonmarket actions to mitigate the potential risk derived from the national political differences between their home emerging economy and host developed economy. This paper aims to extend the legitimacy-based view of political risk to study the influence of political animosity – defined as misalignment of the host-home countries’ national interests – on the EMNCs’ market and nonmarket strategy in a developed market.

In this paper, we examine all EMNCs that made cross-border acquisitions of the USA targets from 2005 to 2011. The final sample consists of 252 acquisitions originating from 25 emerging markets. This paper used Tobit regression analysis to test the direct and moderating hypotheses.

Facing a high level of political animosity between their home country and the host developed economy, EMNCs use a market strategy by acquiring less ownership stake in the developed market, as well as engage in a nonmarket strategy by increasing lobbying activities. In addition, because of the heightened legitimacy concerns of developed market shareholders, cross-listed EMNCs have a greater tendency than non-cross-listed EMNCs to improve their legitimacy through their market and nonmarket strategy.

The current paper sheds light on EMNCs’ international strategy in developed markets by examining both market and nonmarket actions. EMNCs are shown to be strongly motivated to engage in acquisitions in developed markets so they can acquire invaluable strategic resources, such as brands and distribution channels, to compete with the developed market multinationals. A sophisticated ownership strategy and corporate political activities are invaluable for EMNCs to catch up with developed market multinationals.