Contemporary Influences on International Business in Latin America

Under environmental, firm and individual perspectives, this chapter examines the development and contributions of AIB-LAT over time and reviews the varied contributions in this volume, part of the AIB-LAT book series.

This chapter examines the role of government, through government policies, in the internationalization of Brazilian companies. To conduct the study, we sample companies from Apex-Brazil and Abimaq, networks that are susceptible to government support and facilitation policies in order to network. The study used a quantitative approach that consisted of a survey applied to a sample of 104 companies. We compared perceptions between company members versus non-members of the networks. Data analysis revealed that both groups considered that the project supporting internationalization was not relevant. However, we found that in a specific subsample of companies involved in the project, this was considered noteworthy. This showed the relative relevance of the initiative. Future challenges for government promotion of international business are suggested.

International business scholars have studied the impact of reforms on firm performance. Political economists have analyzed the impact of governance structure on macro-economic prosperity. However, little attention has been paid to how political regime and institutional stability affect reforms and performance at the firm level. This comparative case study, examining the dissimilar paths to pro-market reforms in Argentina and Chile, attempts to strengthen the tie between the political economy and international business literature through the impact that regime type has on institutional stability and how these in turn affect the relationship between reforms and firm performance. By examining the pro-market reform history in junction with exclusive interviews with CEOs and managers from each country, this chapter serves as a vehicle to foment a deeper dialogue between political economy and international business.

This chapter aims to investigate the association between the country’s development stage and the level of corporate social disclosure of firms operating in these countries. The theoretical background includes a discussion on corporate social responsibility (CSR), corporate social disclosure (CSD) and the influence of country on CSR and CSD. We tested our research hypotheses using the five stages of development presented in the Global Competitiveness Report (GCR) and the Global Reporting Initiative (GRI) reports of 144 countries. The findings confirm the hypotheses that there is a relationship between countries’ stages of development and the disclosure level of these countries. Our results show that countries in the first stages of development present a lower level of CSD, countries in middle stages are associated with average levels of CSD, and countries in the advanced stage present higher levels of CSD. We explain this association based on institutional issues and stakeholder pressures. Our chapter contributes to the understanding of the factors that may influence differences in disclosure among countries. Since most studies about CSD focus on characteristics at the firm level such as size, industry, and managers’ motivations, our study contributes by presenting evidence on the macro level.

It remains to be seen how the recent October 2018 election will affect Brazil’s economy and foreign multinational corporations aiming to enter and operate in this market. The election has offered Brazilian voters two extreme political choices: Fernando Haddad of the left-wing Partido dos Trabalhadores (PT) party, supported by the popular former president Luiz Inácio Lula da Silva who campaigned for Haddad out of prison while serving his 12-year sentence, and Jair Bolsonaro of the Partido Social Liberal (PSL), a right-wing populist. The election of the latter as the new president, which resulted in a drastic shift of Brazilian politics to the right, raised both concerns and hope in the country. President Bolsonaro’s populist campaign, which has widely been compared with the populist campaign and political rhetoric of US President Donald J. Trump, and the selection of a far-right former army captain as Vice President, one who shares Bolsonaro’s nostalgia for Brazil’s military dictatorship from 1964–1985, are reasons for considerable concerns about a new wave of far-right, authoritarian-style government in the country as well as in Latin America (a wave that has also recently been evident in other parts of the globe). However, the country’s moribund economy and systemically corrupt political environment called for a change in Brazil after nearly 15 years of left-wing rule. The new president’s selection of a University of Chicago-trained free-market economist, Paulo Guedes, as his economic advisor and new finance minister is sending signals of hope that the long-needed economic and financial reforms will be realized, similar to the Milton Friedman-style free-market reforms that were implemented in Chile under General Augusto Pinochet, who came to power in 1973 after overthrowing socialist president Salvador Allende.

This chapter analyses the trajectory of the Cabo Frio beachwear cluster in Brazil. Departing from the extant literature on cluster evolution, the study describes the stages of birth, take-off, growth, and maturity of the cluster, focusing specifically on the attempts to develop exporting activities. The results suggest that the lack of cooperation among local firms is the major reason behind the inability to internationalize, although one cannot dismiss the negative effects of the overvalued Brazilian currency, as well as aspects internal to the firms. Change agents have tried to introduce new practices and attitudes toward cooperation in the cluster, but failed to do so. The key issue, therefore, is why the firms in the cluster failed to cooperate, despite several initiatives and investments to promote collective actions. The chapter advances some possible explanations, with implications for other Brazilian clusters.

The objective of this study is to identify the factors that affect export activities of family small and medium-sized enterprises (SMEs) in an emerging market and to identify the differences between exporters and non-exporters. Based on data collected from Chilean family SMEs, the findings of this study suggest that the major constraints for family business SMEs are problems in selecting a reliable distributor, lack of financial resources, lack of government support, and management’s lack of international knowledge and experience. Significant differences were found in these factors between exporters and non-exporters. In addition, the main international markets for Chilean firms were not necessarily psychically close.

Cross-border merger and acquisition (M&A) practices are increasing around the world. The M&A processes require the acquirer to adapt not only to the national culture that is unfamiliar, but also to deal with a new organizational culture. This chapter analyzes the acculturation process in a cross-border acquisition of a domestic firm by a foreign multinational company in the automobile industry in Brazil. We applied the framework developed by Nahavandi and Malekzadeh (Acad Manag Rev 13:79–90, 1988) that has not been empirically tested. This chapter applies a qualitative approach using a case study analysis. The data was obtained through in-depth interviews with 14 managers involved in pre- and post-acquisition processes. Content analysis showed that managers from the acquired company perceive the acculturation as integration and assimilation; while managers of the acquirer firm consider separation as the mode of acculturation. Such differences in acculturation seem to increase the stress in the M&A process. Furthermore, there are some cultural differences and difficulties in the process, which still make it hard to leverage the results of the new company.

The present study explores the relationship of a number of individual attributes on service performance. Drawing on a sample of employees working within a multinational service company operating in Latin America, we tested the effects of cultural and emotional intelligence on employees’ individual performance. The regression models show that higher levels of cultural and emotional intelligence helped individuals to perform better in their positions. We also found that emotional intelligence seems to interact with cultural intelligence affecting performance. These findings have both practical and theoretical relevance, and might help employers or managers understand how personal characteristics relate to performance internationally.

The purpose of the present study was to assess the effect that three positive attributes have on work performance among a sample of international locals. We measured the influence of self-efficacy, optimism and curiosity on performance in intercultural interactions. We argue that these traits contribute to performance when having intercultural interactions. Significant bivariate correlations were found between work performance and these traits separately. Moreover, the regression model that we proposed—including self-efficacy, optimism and curiosity—predicted work performance and that the individual attributes with higher significant contributions were self-efficacy and curiosity. We discuss the practical and theoretical importance of these preliminary finding and suggest future lines of research.