Working Paper: CEPR ID: DP3640
Authors: Dalia Marin; Thierry Verdier
Abstract: Globalization has been identified by many experts as a new way firms organize their activities. This Paper surveys recent work that examines the role of trade integration between similar and dissimilar countries for these changes in corporate organization. It is shown that international competition and international trade both increase the stakes of the firm, which affects the behaviour of agents inside the corporation. This way, trade integration leads to waves of outsourcing and to convergence in corporate cultures across countries.
Keywords: Corporate governance; Empowerment; International trade; Imperfect competition; Outsourcing; Theory of the firm
JEL Codes: D23; F12; L10; L20
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| International competition (Z28) | Corporate behavior (L20) |
| Trade integration (F15) | Corporate behavior (L20) |
| International competition (Z28) | Restructuring of corporate hierarchies (L22) |
| Restructuring of corporate hierarchies (L22) | Empowerment of workers (J54) |
| Trade integration (F15) | Outsourcing (L24) |
| Trade integration (F15) | Convergence in corporate cultures (M14) |
| Corporate behavior (L20) | Human capital as a key stakeholder (J24) |