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International Business / Edition 3

International Business / Edition 3

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The third edition of this established and highly respected text has been carefully revised to reflect even more clearly the core realities of international business today - the dominance of the ‘triad' (the EU, US and Japan), strategic management thinking, and the activities of multinational enterprises. At the same time, the authors provide a key window to the future of IB, focusing on emerging economies (China, Eastern Europe, South Africa and South America), small and medium-sized enterprises, the internet, and the role played by societal factors such as culture, ethics, ‘green' strategies and corporate responsibility.

Key features of this edition

  • Comprehensive and balanced coverage of the ‘triad' as the unifying framework in which international business predominantly operates.
  • Expanded coverage of China, Brazil, Chile, Africa, Asia and other emerging nations.
  • 40 brand new and 60 fully updated cases provide a fantastic underpinning and real-world illustration of the principal players and themes in IB today
  • A student-friendly and carefully designed pedagogical support structure (including chapter objectives, active learning cases, international business strategies in action, real cases with review and discussion questions) that brings the subject to life and helps students grasp the principal issues
  • Superb 4-colour design and artwork
  • Totally new material on dot.coms, small businesses, supply chain management, B2B, ethics, NGOs and environmental regulations.
A fantastic new support package including:
  • new Student CD-ROM including learning interactivities, video clips and extracases with questions and automatic feedback
  • myCompanionWebsite online resources at to view your cutomisable myCompanionWebsite online teaching and learning resources and syllabus manager.

    What lecturers say:

    "Their balanced coverage of European, North American, and Asian firms and operations, as well as both the manufacturing and service sectors, is unmatched in competitive offerings. The relevance, depth, and vitality of this highly readable text will surely set the new standard by which those texts that follow will be measured. "
    Carol A. Howard, Oklahoma City University

    "This book provides a comprehensive, coherent and intelligent account ofthe complexities of International Business ... with the most balanced coverage of global regional differences of any text book I know."
    Dr Simon Collinson, Warwick Business School

    "This is an exciting, topical and challenging text combining theory withpractice in an outstandingly effective way".
    Professor Sid Gray, University of New South Wales

    Alan M. Rugman -  Professor of International Business and L. Leslie Waters Chair of International Business, Indiana University and Thames Water Fellow In Strategic Management at the University of OxfordRichard M. Hodgetts - Professor of Management, Florida International University

Product Details

ISBN-13: 9780273673743
Publisher: Pearson
Publication date: 12/09/2002
Edition description: 3rd Edition
Pages: 672
Product dimensions: 7.70(w) x 10.40(h) x 1.00(d)

About the Author

Alan M. Rugman is L. Leslie Waters Chair of International Business at the Kelley School of Business, Indiana University, where he is also Professor of International Business and Professor of Business Economics and Public Policy. He was Thames Water Fellow in Strategic Management at Templeton College, University of Oxford, from 1998-2001, where he remains a Fellow. Previously he was Professor of International Business at the University of Toronto 1987-1998, Dalhousie University 1979-1987, and the University of Winnipeg 1970-1978. He has also been a visiting professor at Columbia Business School, London Business School, Harvard University, UCLA, MIT, Warwick Business School, and the University of Paris-La Sorbonne.

Dr Rugman has published over 200 articles dealing with the economic, managerial, and strategic aspects of multinational enterprises and with trade and investment policy. These have appeared in such leading refereed journals as: American Economic Review, Strategic Management Journal, Journal of International Business Studies, California Management Review and The World Economy. His 30 books include: Inside the Multinationals (Columbia University Press, 1981); Multinationals and Transfer Pricing (co-author) (St Martin's Press, 1985); Administered Protection in America (co-author) (Routledge 1987); Global Corporate Strategy and Trade Policy (co-author) (Routledge 1990); Foreign Investment and North American Free Trade (ed.) (University of South Carolina Press, 1994); International Business (co-author) (McGraw-Hill 1985, 1995); The Theory of Multinational Enterprises andMultinational Enterprises and Trade Policy (Elgar, 1996); Environmental Regulations and Corporate Strategy (coauthor) (Oxford University Press, 1999); Multinationals as Flagship Firms (co-author) (Oxford University Press, 2000); International Business (FT/Prentice Hall, 2000); The End of Globalization (Random House, 2000; AMACOM, 2001); and (coeditor) The Oxford Handbook of International Business (Oxford University Press, 2001).

As a leading authority in international business, Dr Rugman served as Vice-President of the Academy of International Business in 1989-1990 and was elected a Fellow of the Academy in 1991. He is also a Fellow of the Royal Society of Arts, elected 1998. He has been identified as one of the five most cited scholars in International Business. He has lectured widely across North and South America, the Caribbean, in Western Europe, Australia, and in East Asia.

He has written for the Financial Times, Toronto's Globe and Mail and Financial Post, and many magazines. His research on multinationals, free trade, NAFTA, and globalization has been discussed in the New York Times, Business Week, US News and World Report, Canadian Business, and on the television and radio outlets of the BBC, CBC, and numerous other media. He is a member of the TIME Canada Board of Economists.

Born in England in 1945, Dr Rugman became a Canadian citizen in 1973. He earned his BA in economics from Leeds University in 1966, MSc in economic development from London University's School of Oriental and African Studies (SOAS) in 1967, and his PhD in economics from Simon Fraser University in 1974. He was elected to an MA (Oxon) in 1998.

Dr Rugman served as an outside advisor on international competitiveness to two Canadian Prime Ministers over the 1986-1993 period. He was the only academic member of Canada's business International Trade Advisory Committee from 1986-1988 while the United States-Canada Free Trade Agreement was being negotiated. Subsequently he served on the sectoral trade advisory committee for forest products from 1989 to 1993, as NAFTA was negotiated. He has been a consultant to major private sector companies, research institutes and government agencies. These include Exxon/Imperial Oil, Kodak, Royal Bank of Canada, Northern Telecom, and other multinational enterprises. He has also been a consultant to international organizations such as the United Nations (UNCTAD), NAFTA's Commission on Environmental Cooperation, the Organization for Economic Cooperation and Development (DECD), and the Commonwealth Secretariat.

Richard M. Hodgetts was a Professor of Management in the Department of Management and International Business at Florida International University (FIU). He was born and raised in New York City and earned his BS in management at New York University in 1963, his MBA at Indiana University in 1964, and his PhD at the University of Oklahoma in 1968. He then joined the faculty at the University of Nebraska, Lincoln (1966-1975), where he taught strategic management. After accepting a visiting professorship at Texas Tech University (1975-1976), he joined Florida International University (FIU) in 1976 where he taught international business in both the Executive MBA program and the Graduate Diploma Serifs program and the strategic management course at the MBA level.

Dr Hodgetts published over 125 articles and research papers in a wide variety of areas including international strategy, international compensation, the development of metrics for world class organizations, and the role of quality in creating sustainable advantage in the 21st century. He was the author or co-author of 50 different books including International Management, 5th edition (Irwin/McGraw, forthcoming), which is the best selling international management textbook in the world; Entrepreneurship, 4th edition (Dryden, 1999), which is the leading entrepreneurship book in the US market; and a series of quality-focused management books including Measures of Quality and High Performance: Simple Tools and Lessons from America's Most Successful Firms (Amacom, 1998). Overall, Richard Hodgetts sold 1 million copies of his textbooks.

Professor Hodgetts also served as a trainer and consultant for a wide variety of organizations and firms including Advanced Micro Systems, AT&T Technologies, Digital Equipment, Eastman Kodak, General Electric, General Motors, Hewlett-Packard, Motorola, Procter & Gamble, Wal-Mart, and the US Federal Reserve System.

Dr Hodgetts was the editor of the Journal of Leadership Studies and the book review editor for Organizational Dynamics. He was also a member of the review boards of the Journal of Economics and Business and the Journal of Business Research. Dr Hodgetts wrote a biweekly column titled "Minding Your Business" for the Ft. Lauderdale Sun Sentinel. He was also a past member of the Academy of Management Board of Governors (1993-1996) and a member of the Fellows of the Academy since 1983.

In recent years Professor Hodgetts was the recipient of a number of awards including the Outstanding Educator Award, Academy of Management (1999), the John F. Mee, Management Contribution Award, Management History Divisioh, Academy of Management (1998), and the Professorial Excellence Program Award, FIU (1997).

Table of Contents


1. Regional and Global Strategy
2. The Multinational Enterprise
3. The Triad and International Business


4. International Politics
5. International Culture
6. International Trade
7. International Finance


8. Multinational Strategy
9. Organizing Strategy
10. Production Strategy
11. Marketing Strategy
12. Human Resource Management Strategy
13. Political Risk and Negotiation Strategies
14. International Financial Management


15. Corporate Strategy and National Competitiveness
16. The European Union
17. Japan
18. North America
19. Non-Triad Nations


20. Future Challenges in International Business
Subject Index
Name Index


In this Third Edition we re-emphasize the theme of the "triad" ; i.e. the dominant economies today of the European Union (EU), the United States, and Japan. We have also retained our focus on the strategies of multinational enterprises (MNEs) either based in the triad, or seeking access to triad markets. The MNE is the unit of analysis in this book. The world's 500 largest MNEs continue to dominate international business, and over 430 of them come from the triad. The large MNEs also serve as "flagship firms" ; i.e. the leaders of localized regional business networks or clusters, in which other MNEs, small and medium-sized businesses, and service organizations also participate.

We emphasize the triad theme in three ways:

  1. The data on trade-based international business activity, mainly in Chapters 1-3, have been rewritten and updated. Chapter 1 has been rewritten to explain the role of the triad in international business rather than the simplistic (and incorrect) discussion of "globalization" that pervades many other textbooks. The reality of international business is that MNEs do not have "global" strategies, but that they mainly operate at a "regional" level within and between triad members. It is also important to note that, today, firms and organizations outside the triad need to access at least one of the triad markets in order to build a successful business. We discuss both triad and non-triad MNEs in this book.
  2. Of the 100 mini-cases in the book (five in each of the 20 chapters) we have introduced 40 brand new cases and totally revised the remaining 60. There is now a better balance between European, North American, and Asian cases. Weconcentrate on the strategies of the 500 larger MNEs from the triad, but also include a wealth of new cases from smaller and emerging economies, as discussed below.
  3. We have introduced more theory especially in the last two parts of the book. This allows us to analyze more deeply the nature of triad/regional strategies of MNEs, rather than stop at the basic level of internationalization common in other books. In Chapters 1 and 15 we use the "diamond" and "double diamond" frameworks of international competitiveness. We use the global/local framework in Chapter 15 to show that many MNEs need a "local" rather than a "global" strategy. Now, in a rewritten Chapter 20, we analyze the strategy of MNEs, by using three frameworks. This allows us to revise and synthesize the major themes in the book. First is the firm-specific advantage (FSA) and country-specific advantage (CSA) framework to show how firm-level managerial resources are related to mostly exogenous country-specific factors. Second is the "flagship framework" to demonstrate the central role of large MNEs in business networks across the triad. Third is a framework to relate the trade and investment provisions of NAFTA and the FTAA to the deeper political and social integration of the EU.

Overall, the Third Edition has reduced the previous emphasis on US examples and practice in the First Edition in order to build up and consolidate the European and Asian examples and practice introduced in the Second Edition to an equal level.

The Third Edition also has a much greater focus on the emerging economies, China in particular, but also Russia and Poland. We also look at Latin American countries and MNEs, for example, in and from Brazil and Chile. In order to link the activities of MNEs in non-triad economies to the triad theme, we consider MNEs and international business opportunities in the larger non-triad economies. We include relevant cases like Codelco of Chile, Anglogold of South Africa, Brazilian television soaps, Citibank in China, etc. We retain our triad focus on Japan as the leading Asian economy but also consider South Korea, India, Australia, and others in some detail. We also introduce cases on major sports like cricket, which is a huge business in India, Pakistan, and Bangladesh. Indeed, we have added 10 new cases dealing with the service sector, several new cases dealing with the Internet and small business, and also new cases on "themes"; especially those of concern to civil society.

Material on culture in Chapters 5, 13, and 14 has been rewritten to reduce the focus on Hofstede's work and to update it with newer approaches. In Chapter 10 on production, there is a greater emphasis on supply chain management and a new case to illustrate this. We have updated material on the WTO and NAFTA and included a discussion of the FTAA. We also explain the B2B (business-to-business) interaction across business networks (in cases like Accor, Nortel, and Michelin) and the role of the Internet (in cases like,, Skandia, and Dell B2C) much more than in previous editions.

We have also introduced new cases dealing with issues of corporate social responsibility, the civil society and ethics, especially in Chapters 4, 5, 13, and 20. We explore the increased importance of nongovernmental organizations (NGOs). In several of the cases we also explain several themes in new cases dealing with APEC, tax havens, global accounting standards, environmental policy, lumber tariffs, and the September 11, 2001 events. We discuss small and medium-sized businesses (SMEs) in more detail in cases like Command Alkon and Mountain Equipment.

Readers and instructors will find this a very student friendly Third Edition of an already popular textbook. It is suitable for community colleges, as well as college students in North America, and for undergraduates in Britain, Europe, and Asia. The upgraded new theoretical material in Parts IV and V now makes it more suitable for MBA students.

We are very grateful for helpful comments from reviewers of the entire manuscript of the Third Edition, namely: Professors Karl Moore of McGill University; Ajeet Mathur of University of Tampere, Finland; David Edelshain of City University Business School, London, and Sony Nwankwo of the University of East London. We would also like to thank those who provided guidance and help with comments on the Second Edition: Brad Brown of the University of Virginia, Hamed El-Said of Manchester University, Ander Hytter of Vaxjo University, Sweden, and Sandy Lindsay of Napier University. We are also very pleased to acknowledge the great dedication and ongoing help and support from Mildred Harris at the Kelley School of Business, Indiana University, and of Helen Rugman.

Over the period December, 2001-March, 2002, a major contribution to Chapters 10-20 was made by Ms Cecilia Brain of Toronto, a former research assistant on the Second Edition of the book who continued working with Professor Rugman as he moved from the University of Toronto to Templeton College, University of Oxford, and now to Indiana University. Cecilia also prepared the index and instructor's manual, and she worked on all of the new cases and all of the tables, bibliography, and other material in the text.

We are also grateful to the team at Pearson Education, Geraldine Lyons, Andrew Taylor, Bridget Allen, Sarah Phillipson, Richard Whitbread, and Simon Lake.

Alan M. Rugman, Indiana and Oxford
Richard Hodgetts, Miami

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