Authoritarian Abdication: Bargaining Power and the Role of Firms in Migrant Welfare

Throughout the Arabian Gulf, the immigration law known as the kafala formally delegates to firms and other “sponsors” control over migrants’ mobility, housing, and general welfare. These states have abdicated almost any responsibility over migrants, giving firms nearly unchecked power over their workers’ daily lives. In this paper, I consider the welfare implications of this system and explore the conditions under which migrants can extract concessions from firms. Drawing on a nationally representative survey from Qatar, I show that migrant satisfaction, workplace difficulties, and overall quality of life varies widely across camps and firms. In explaining this variation, I argue that welfare crucially depends on an individual’s bargaining power. Migrants with a contract or credible exit options hold greater bargaining power, which strongly associates with improved perceptions of welfare. All told, contracts and exit options appear to provide even the most vulnerable workers a means of protection within authoritarian states.     

Building Ladders out of Chains: China's Hybrid-led Technological Development in Disaggregated Value Chains

In China, entrepreneurs hailing from ethnic Chinese transnational technology networks have linked up with global capital to create hybrid firms that combine relatively efficient foreign financing with a strategic commitment to intensive utilisation of domestic resources to create their core corporate competencies. This article refers to these firms as global hybrid firms and to development driven by these firms as hybrid-led development. Hybrids, given their generally small scale and scope, work best in sectors exhibiting disaggregated value chains, fast clockspeeds and high technology-intensity. Patent data demonstrates that hybrids outperform other firms generally and especially in sectors exhibiting these three characteristics.     

Transnational Capital,the US State and Latin American Trade Agreements

This paper examines the role of US-based transnational corporations in advancing trade, investment, regulatory and intellectual property rights provisions within NAFTA and DR–CAFTA. I explore the linkages between US firms, the US state and investment patterns in Mexico, Central America and the Dominican Republic in order to develop a framework for understanding the political economy of these regional trade agreements. I locate the timing of each of these agreements within the context of the goals of a transnational interest bloc that includes US-based transnational firms, US state officials and regional business interests and state bureaucracies in Latin America, with each trying to utilise regional agreements as a substitute for failed multilateral initiatives as well as a springboard for advancing a more aggressive set of protections for investors within bilateral investment treaties. In order to determine the extent to which transnational firms based in the USA have influenced these trade agreements, I explore three interrelated aspects of business influence: the extent to which transnational firms with investment interests in Mexico and Central America were involved in organisations that had regular access to key US policy makers; the historical development of a transnational interest bloc that has linked US firms and the US state to transnational capital and state bureaucracies in Mexico, Central America and the Dominican Republic; and the extent to which the same group of transnational firms has been attempting without success to advance a policy agenda in the WTO that incorporates many of the provisions of NAFTA and DR–CAFTA. The failure of this transnational interest bloc to effect substantial changes in WTO policies has led the bloc to rely on regional trade agreements to pursue its interests.     

The Politics of Telecommunications Regulation: State–Industry Alliance Favouring Foreign Investment in India

This paper explores the political economy of three significant policy decisions of the Congress–United Progressive Alliance government between November 2005 and February 2006. These decisions improved the regulatory incentives for the smaller and efficient firms in the Indian GSM industry, which were heavily dependent on foreign investment for their expansion. India's telecommunications sector became more attractive to foreign investors as a result of these regulatory changes. This was a notable departure from the past when government policy had favoured large domestic investors using CDMA technology who were not dependent on foreign capital. A globalisation friendly policy change occurred after a Centre-Left United Progressive Alliance coalition came to power. The paper argues that these decisions, which promoted both competition and foreign investment, occurred due to the increased sensitivity of the Department of Telecommunications towards the needs of the relatively smaller GSM service providers, driven by considerations of efficiency. They were not driven by a crisis of private investment, foreign pressure, or stealth. The shift occurred in normal times when the Department of Telecommunications under a persistent ministerial stewardship took on a regulator, which was less interested in engineering this shift. This globalisation-friendly strategy depended to a large extent on the particular industrial sub-sector that the ruling party or coalition supported for spreading telecommunications in India.     

Decomposing the Labour Productivity Gap between Migrant-Owned and Native-Owned Firms in Sub-Saharan Africa

Migration studies have been primarily based on the movement of individuals from developing to developed economies, with a focus on the impact of migrants on host country wages. In this study we take a different angle by exploring the labour productivity of migrant-owned firms versus native-owned firms in 20 African economies using firm-level data. We find that labour productivity is 78 per cent higher in migrant-owned firms than native-owned firms. Using the Oaxaca-Blinder decomposition method we find that structural effects account for 80 per cent of the labour productivity gap. Returns to manager education largely explain the productivity advantage of migrant-owned firms over native-owned firms. Interactions with the government, access to finance, informality, and power outages are also considerable contributors to the labour productivity gap.     

The Truth about Trade: The Real Impact of Liberalisation

The usual perspective on technology spillovers from FDI sees the MNC subsidiary as a passive actor. It presumes that the technological superiority that spreads from subsidiaries to other firms in the host economy is initially created outside it by MNC parent companies, and is delivered to subsidiaries via international technology transfer. The role of subsidiaries is little more than to act as a ‘leaky container’ lying between the technology transfer pipeline and the absorption of spillovers by domestic firms. This paper suggests a different model in which a substantial part of the potential for spillover is created within local subsidiaries as a result of their own knowledge-creating and accumulating activities in the host economy. We explore empirically the effects of these activities on technology spillovers from FDI using data for industrial firms in Argentina over the period 1992–96. The analysis suggests that significant results can be obtained incorporating subsidiaries' own technological activities as an explanatory variable of the spillover process.     

Latin America's Left Turns: beyond good and bad

In rapid succession leftwing parties have been elected to government in some of the most important countries in the Latin American region. I challenge the view that there are two distinct variants of the left—one populist, the other social democratic—and argue that variation on the left reflects the diverse conditions under which these forces emerge and evolve. I outline common features shared by the left in Latin America; suggest how the concept of populism and analysis of social movements can help explain this variation; and show how the left's commitment to egalitarianism, balancing markets, and, in some cases, its appeals to the constituent power of the people enabled it to benefit from disillusionment with the results of neoliberalism, the poor performance of democratic governments in Latin America, and the evolving international context.     

Globalizing Corporate Environmentalism? Convergence and Heterogeneity in Indian Industry

What explains the recent emergence of corporate environmentalism in developing countries? Why have certain firms surpassed others in greening their activities? This article situates the uneven dynamics of corporate greening within a theoretical framework of convergence, firm specificity, and heterogeneity. Through a comparative analysis of firms in three sectors—automobiles, steel, and power—of the Indian economy during the past two decades, I show that corporate greening is rooted in processes of growing international political engagement, market integration, and transnational social communication. Together, these processes have unleashed various economic and sociological convergence dynamics, which have led firms in India to adopt more environmentally sound innovations and performances increasingly similar to those found in many developed countries. Yet firms’ connectedness to external pressures fostering “upward” convergence varies, as do their internal capabilities to respond to them. Heterogeneity in these internal and external variables, and the firm-specific strategies linking them, accounts for much of the unevenness in patterns of corporate environmentalism observed in India.     

Tansnationals and foreign trade: Evidence from Brazil

A recursive model of exports and imports of manufactures, in which imports depend in part on exports, is estimated using data for a cross‐section of 17,053 industrial firms. In this sample, 652 firms are foreign‐owned. Explanatory variables include firm size, skill intensity, advertising and other variables in addition to foreign ownership. Foreign ownership has a large, independent effect on both export performance and import propensities, but foreign ownership in itself explains little of the relatively low export/import ratios registered by affiliates of transnationals.     

Organised crime and international aid subversion: evidence from Colombia and Afghanistan

Scholarly attempts to explain aid subversion in post-conflict contexts frame the challenge in terms of corrupt practices and transactions disconnected from local power struggles. Also, they assume a distinction between organised crime and the state. This comparative analysis of aid subversion in Colombia and Afghanistan reveals the limits of such an approach. Focusing on relations that anchor organised crime within local political, social and economic processes, we demonstrate that organised crime is dynamic, driven by multiple motives and endogenous to local power politics. Better understanding of governance arrangements around the organised crime–conflict nexus which enables aid subversion is therefore required.     

The economic impact of a foreign debt bail‐out for private firms in Ecuador

In this article the effect of Ecuador's general foreign debt conversion programme on private firms' financial position is analysed. The programme, called the Sucretización, was similar to programmes implemented by many heavily indebted countries after the debt crisis began. I concentrate on the Sucretización's implicit transfer from the government to firms, arguing that it was large, but unnecessary. Very few firms would have gone bankrupt because of their devaluation‐induced foreign exchange losses. What is more, I find no evidence that firms receiving these transfers used them to strengthen their balance sheets.     

Exploring the foundational origins of public service motivation through the lens of behavioral genetics

Despite the proliferation of research on public service motivation (PSM), fundamental questions about its origins continue to evade scholars: Is PSM driven by genetics, socialized through experiences, or both? If PSM is socialized, when does socialization occur? Answering these questions is critical for reconciling the state versus trait debate, and for assessing the validity of practical implications prescribed by PSM studies. Utilizing “nature's own experiment,” we adopt a classical twin design with 1035 twin pairs to identify how genetic heritability, a common environment, or unique environment and experiences can explain variation in PSM. Results show that PSM is heavily influenced by individuals' unique environments and experiences; not by genetics. This lends strong evidence to PSM's uniqueness as a motivational construct as related “other-regarding” concepts show sizeable genetic components. Finally, our results corroborate that PSM is a human resource with dynamic properties organizations can cultivate to enhance productivity in public service workforces.     

Should the African lion learn from the Asian tigers? A comparative-historical study of FDI-oriented industrial policy in Ethiopia,South Korea and Taiwan

Ethiopia’s economy has been growing at breakneck speed for well over a decade now, earning the nickname as Africa’s lion. In recent years, the development literature on Ethiopia has paid particular attention to the role of industrial policy, especially the ways in which the Ethiopian experience compares to that of the Asian tigers. But through this comparative-historical perspective, little attention has been devoted to an important aspect of industrial policy in Ethiopia – foreign direct investment (FDI) in the manufacturing sector. This paper compares FDI-oriented industrial policy in Ethiopia in the current era (particularly focusing on light manufacturing) to that of South Korea and Taiwan between 1960 and 1990, arguably the two most generalisable cases among the Asian tigers. The paper argues that FDI-oriented industrial policy in Ethiopia seems to be bringing about short-term economic benefits, and is showing promise for further industrialisation. At the same time, it could benefit from taking more lessons from the long-term economic development perspective that characterised South Korea’s and Taiwan’s approach to FDI. Such a long-term perspective most importantly includes pro-active strategies to transfer technology from foreign firms to the domestic economy and the creation of backward linkages from foreign to domestic firms.     

Organizational reputation and risk regulation: The effect of reputational threats on agency scientific outputs

This article aims to explain the variation in the scientific risk assessments conducted by two regulatory agencies: the European Food Safety Authority (EFSA) and the French Agency for Food, Environmental and Occupational Health and Safety (ANSES). To explain the merits of scientific risk assessments that have caused polarization within the EU, this article draws on bureaucratic reputation theory. The theory argues that regulators are political organizations that are active in protecting their unique organizational reputations. The findings obtained from interviews, direct observations, and primary documents yield support for this framework: depending on reputational threats, agencies choose to emphasize either their role as guardians of the prevailing social values, or send strong professional signals by delivering a scientifically rigorous risk assessment.     

Actions and Reactions of Russian Manufacturing Companies to the Crisis Shocks from 2008–2009: Evidence from the Empirical Survey

This essay explores the nature of the 2008 crisis and the channels through which it affected the performance of firms in Russia. Based on the findings of a manufacturing industry survey, the evidence suggests that all manufacturing firms were affected by the crisis and that there is no single and dominant transmission channel. Crisis reactions were significantly related to participation in international markets, although participation in trade, in external borrowing or FDI cannot explain recession by themselves. The reversal of growth was mainly caused by demand shock and, following that, by financial constraints. Thus the hypothesis that blames overheating of internal demand in the years prior to the crisis seems to receive statistical backing. Globalised companies, though hit by external shocks, were better prepared to pay the cost and balance the consequences of the crisis.     

Policy Reforms and Evolution of Market Structure in an Emerging Economy: The Case of India

Policy reforms have facilitated entry of quite a few transnational corporations (TNC) into Indian industries. This has important implications for the evolution of competitive industrial structure. This article focuses on the issue of the response mechanism of local firms to competition from new entrant TNCs and the possible strategies of TNCs in penetrating the Indian market. It develops a conceptual framework by incorporating elements of intangible assets theory and new institutional economics into a simple sequential entry oligopoly model. This yields interesting insights into qualitative behaviour of firms in the post-reforms period. A few hypotheses drawn from the conceptual framework are empirically tested on the basis of firm level panel data drawn from a set of Indian industries.     

The Political Economy of Child Mortality Decline in Tanzania and Uganda, 1995–2007

This article identifies political economy factors that help explain dramatic differences in the pace of child mortality reduction between Tanzania and Uganda from 1995 to 2007. The existing literature largely explains divergence in basic health outcomes with reference to economic variables such as GDP per capita. However, these factors cannot explain recent divergence across African countries with similar levels of GDP per capita, rates of economic growth, and levels of health funding. I argue that institutional and governance divergences between Tanzania and Uganda can be linked directly to differing coverage levels of key child health interventions (especially related to malaria control), and thus to differing child health outcomes. These institutional differences can be explained in part by historical factors, but more relevant causes can be found in recent political events. In Tanzania, there was an unusually effective project of institution building in the health sector, while in Uganda, by contrast, there was a negative political shock to the health system. This was driven by the repatrimonialization of the Ugandan state after President Yoweri Museveni??s decision to eliminate term limits in the 2001?C2006 period. This repatrimonialization process reversed previous health sector institutional gains and had particularly negative effects on child health service delivery in Uganda over the period in question.     

Ownership or Competition? An Evaluation of the Effects of Privatization on Industrial Relations Institutions, Processes and Outcomes

This paper examines whether privatization and exposure to product market competition leads to changes in labour management and industrial relations. Three sets of propositions are examined: privatization will lead to lower changes in industrial relations institutions and processes; privatization will lead to lower average levels of remuneration relative to public sector firms; and privatization will lead to relatively higher levels of efficiency. In each instance it is hypothesized that competition will add to ownership effects. These propositions are examined drawing on data derived from the UK bus industry.     

Ownership or Competition? An Evaluation of the Effects of Privatization on Industrial Relations Institutions,Processes and Outcomes

This paper examines whether privatization and exposure to product market competition leads to changes in labour management and industrial relations. Three sets of propositions are examined: privatization will lead to lower changes in industrial relations institutions and processes; privatization will lead to lower average levels of remuneration relative to public sector firms; and privatization will lead to relatively higher levels of efficiency. In each instance it is hypothesized that competition will add to ownership effects. These propositions are examined drawing on data derived from the UK bus industry.     

Accumulating Technology and Location Spillovers Among Firms in Taiwan's Electronics Industry

Using firm-level panel data from the Taiwanese Census of Manufactures for 1986 and 1991 in the context of a modified selection model, we focus on three activities that contribute to the productivity growth of firms in the electronics industry: research and development, direct foreign investment and exports. In particular we address the issue of whether, in addition to the direct benefits of these activities, there are spillovers to other firms within the same four-digit industry or within the same geographical county. Our empirical results indicate that while the survival and direct productivity growth effects of R&D, exports and DFI are positive and statistically significant, intra-industry and geographical spillover effects are consistently present only for the export activity. That is, a firm's expected future TFP is positively and significantly affected by being located in a county and industry with more export activity. In addition, there is some evidence that the indirect effects generated by DFI firms, in the form of location spillover benefits to other firms, are also positive and significant. Finally, the empirical results indicate that the above direct and indirect benefits of the technological activities under study accrue principally to Taiwan's small and medium enterprises, rather than its large firms.