Emerging Economies : Business Opportunities And Challenges For Foreign Investment, And International Trade

1407 Words Mar 31st, 2016 6 Pages
According to (Hadjikhani, Ghauri, & Elg, 2012), emerging economies have been increasingly market oriented and friendly towards foreign investment, and international trade. However, such an environment creates both business opportunities and challenges for both MNEs and local businesses. Local companies, with their existing strong relationship with local authorities attempt to limit the activities of the foreign companies. Since the inception of the economic liberalization, many western MNEs have established their manufacturing facilities in China to benefit from the investment-friendly government policies. Björkman and Xiucheng (2002) find that organizational performance is positively related to the extent to which firms integrate their home-country HRM policies and strategies. These policies include performance-based compensation, individual rewards, extensive training of employees, etc.
The notion of managerial ties has been extensively studied in relation to various economic, social, and political dimensions of the host country. Several definitions of “managerial ties” have been put forward by scholars. In the words of Geletkanycz and Hambrick (1997), Managerial tie is defined as "executives ' boundary-spanning activities and their associated interactions with external entities" (p. 654). Peng and Luo (2000) identify two types of managerial ties – the first one denotes the tie between managers at one firm with managers at other firms. This is referred to as business…

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