Prof Saul Estrin NAB4.32

This course is compulsory on the Executive Global MSc Management. This course is not available as an outside option.

This course analyses the emergence of firms which operate on a global scale and their current and likely future interactions with emerging markets. Multinational firms have been an increasingly significant aspect of the corporate environment in developed countries since the 1960s, and are responsible for a high proportion of global output, exports and investment, as well as the bulk of foreign direct investment. In the past few decades their activities have been increasingly focused to developing economies, notably those which have liberalised and entered a more rapid growth phase. These economies, emerging markets, include some important world economies including China, India, transition economies such as Russia, and Latin American countries such as Brazil and Argentina. The new institutional economics has recently developed as a field to understand the impact of variation in institutions on economies¿ performance. This course will focus on how the institutional characteristics of emerging markets affect the choices and behaviour of multinational firms, now and into the future. We commence with the basic framework of analysis of the behaviour of multinational enterprises (MNEs), outlining models of the MNE which draw on transaction cost economics, the eclectic OLI paradigm of Dunning, and more recent concept such as the resource based view. We will then provide an analysis of economic performance and growth in emerging markets building on the new institutional economies and working with a large variety of datasets and sources. The remainder of the course is devoted to specific topics of MNEs in emerging markets. These include the determinants and impact of FDI; entry mode choices; measures of institutional distance; outsourcing and offshoring; and emerging market multinationals. Outline of Lectures: Lectures 1 and 2: Models and Strategies of the Multi-National Enterprise (MNE) Lectures 3 & 4: Growth and Institutions in Emerging Markets Lecture 5: The Determinants of Foreign Direct Investment (FDI) into Emerging Markets Lecture 6: The Impact of FDI on Emerging Markets - Horizontal Lecture 7: The Impact of FDI on Emerging Markets Vertical Lecture 8: MNEs and Modes of Entry Lecture 9: FDI and Distance Lecture 10: Emerging Market Multinationals

32 hours of lectures in the MT. 8 hours of lectures in the LT.

Scheduled over three modules, one of which will take place overseas – 10 sessions of up to 4 hours.

Students will be expected to produce 1 essay in the MT.

R. Caves, Multinational Enterprise and Economic Analysis, 2nd Edition,

Cambridge University Press 1996;

P. Ghemawat, Redefining Global Strategy, Harvard Business School Press,

2007;

J. Williamson, The New Institutional Economies, Journal of Economic

Literature, 2000;

Estrin et. al., Entry Mode in Emerging Markets, Strategic Management

Journal, 2009;

T. Khanna and K Palepu, The Future of Business Groups in Emerging Markets,

Academy of Management Journal 2004.

Take home exam (60%) in the LT.
Presentation (30%) in the MT.
Class participation (10%) in the MT and LT.