Thesis (MEconSt.) - University of Queensland, 2002.

This study investigates the link between global integration -- defined as the intra-firm cross-border transfer of operational resources -- and performance in multinational professional engineering companies. Using a combination of qualitative and quantitative techniques, we find some support for a positive association. We review two bodies of scholarship germane to our topic: the global integration - performance literature and the multinationality - performance literature. The inclusion of the latter is justified since the espoused performance benefits of multinationality are predominantly realised through global integration. Based upon an evaluation of these two bodies of scholarship and qualitative insights, we propose a positive relationship between global integration and performance as well as a mediating relationship, with global integration acting as a mediator between multinationality and performance. Hypothesis testing is performed in Partial Least Squares, a structural equation modelling technique ideally suited for small samples. Results reveal a significant positive association between global integration and MNC profitability. A separate research model testing the relationship between global integration and the alternative dependent, MNC growth, is rejected. Further analysis of the profitability-based research model provides support for the mediational hypothesis: the relationship between multinationality and profitability is fully mediated, suggesting no gains from multinationality per se. Supplementary tests reveal that the profitability effects of global integration are enhanced when it is strongly motivated by the desire to take advantage of specialised skills within the MNC; no such claim of moderation can be made when global integration is strongly motivated by a desire to improve staff utilisation on a global basis. The relationship between global integration and profitability is also unaffected by the origins (headquarters vs. subsidiaries) of the intra-firm operational resource transfers that constitute global integration.

Thesis (Ph.D. (Economics))-University of Pretoria, 2005. / Includes summary. Includes bibliographical references. Available on the Internet via the World Wide Web.

<p>This essay in economic geography describes what intra-firm trade as a concept is and different ways to determine in which cases trade is to be labeled as intra-firm trade (IFT) or not. The method used by the author is most easily described as descriptive. This method was chosen in order to test if existing theories; classic and neoclassic economics, new trade theory and international business studies, are capable to explain the phenomena of IFT. The theories are tested trough primary and secondary literature but also trough reasoning by the author.</p><p>The conclusion is that the most reasonable way to determine whether trade occurs intra-firm or not, is to decide upon a 5-% rule where it when one part owns 5-% of the voting strength in the other company is to be considered intra-firm trade. This is a conclusion based on several reasons; the strongest one being that a common view on IFT could boost comparative studies as the U.S already collects data based on the 5-% rule.</p><p>Classic and neoclassic economics are incapable of explaining IFT as aprerequisite for these theories is that markets are perfect. IFT can only beexplained by models building on imperfect markets hence new trade theory and international business are more successful in explaining IFT.</p>

This essay in economic geography describes what intra-firm trade as a concept is and different ways to determine in which cases trade is to be labeled as intra-firm trade (IFT) or not. The method used by the author is most easily described as descriptive. This method was chosen in order to test if existing theories; classic and neoclassic economics, new trade theory and international business studies, are capable to explain the phenomena of IFT. The theories are tested trough primary and secondary literature but also trough reasoning by the author. The conclusion is that the most reasonable way to determine whether trade occurs intra-firm or not, is to decide upon a 5-% rule where it when one part owns 5-% of the voting strength in the other company is to be considered intra-firm trade. This is a conclusion based on several reasons; the strongest one being that a common view on IFT could boost comparative studies as the U.S already collects data based on the 5-% rule. Classic and neoclassic economics are incapable of explaining IFT as aprerequisite for these theories is that markets are perfect. IFT can only beexplained by models building on imperfect markets hence new trade theory and international business are more successful in explaining IFT.