The globalization of firms is explored at theoretical and empirical levels. The idea is that a global firm is a multi-cultural team. The existence of a global firm is somewhat puzzling. Combining workers who have different cultures, legal systems, and languages imposes costs on the firm that...

We study which dimensions of corporate culture are related to a firm's performance and why. We find that proclaimed values appear irrelevant. Yet, when employees perceive top managers as trustworthy and ethical, firm's performance is stronger. We then study how different governance structures...

Culture has played a pivotal role in human evolution. Yet, the ability of social scientists to study culture is limited by the currently available measurement instruments. Scholars of culture must regularly choose between scalable but sparse survey-based methods or restricted but rich...

We develop an assignment theory to analyze the volume and composition of foreign direct investment (FDI). Firms conduct FDI by either engaging in greenfield investment or in cross-border acquisitions. Cross-border acquisitions involve firms trading heterogeneous corporate assets to exploit...

The US-Mexico free-trade debate included some theoretical assertions that were then used as arguments against trade and investment liberalization. (1) Trade liberalization increases the degree to which production is internationally relocated in response to environmental restrictions...

The degree of internationalizaton of the enterprise or business sectors of many countries, as measured by the ratio of direct investment abroad to domestic wealth or assets, or of assets or employment abroad to that at home, has been growing over the last twenty years or more. The exception to...

This paper develops a model of regional production networks based on localization economies. I consider an industry with two activities: one with location-specific external economies, the other with constant returns. Under autarky, localization economies imply the formation of an industry...

We consider trade between two countries of unequal size, where the creation of new intermediate inputs occurs in both. We assume that the knowledge gained from R&D in one country does not spillover to the other. Under autarky, the larger country would have a higher rate of product creation. When...

We study the determinants of the extent of outsourcing and of direct foreign investment in an industry in which producers need specialized components. Potential suppliers must make a relationship-specific investment in order to serve each prospective customer. Such investments are governed by...

Tax policy toward the overseas income of U.S. firms is an important issue since foreign investment accounts for a sizabLe fraction of total investment by U.S. firms. At present there is no consensus on the degree to which U.S. firms respond to tax incentives when making international investment...