Emerging markets research: Trends, issues and future directions

Emerging Markets Review 13 (2012) 159–183

Contents lists available at SciVerse ScienceDirect

Emerging Markets Review

j ourna l homepage: www.e lsev ie r .com/ locate /emr

Emerging markets research: Trends, issuesand future directions☆

Colm Kearney⁎Monash University, Australia

a r t i c l e i n f o

☆ Paper presented to the conference on ‘Institutioplaces’, organised by the Eureomed Management Sch2011.⁎ Faculty of Business and Economics, Monash Univ

E-mail address: [email protected].

1566-0141/$ – see front matter © 2012 Elsevier B.V.doi:10.1016/j.ememar.2012.01.003

a b s t r a c t

Article history:Received 26 December 2011Accepted 10 January 2012Available online 18 January 2012

We survey recent research on emerging markets (EM) within thefields of economics, finance, international business and management.To do this, we reconfigure the Journal of Economic Literature (JEL)classification system to provide a comprehensive list of the topicsthat have been studied, and we combine it with the main journalranking methodologies to identify the journals in which significantcontributions to EM research have been disseminated. We highlightthe areas of greatest interest and those that have received relativelylittle attention to date. The suggested topics for future research in-clude: Data and methods; market efficiency, risk-adjusted returnsand risk premia; exchange rate volatility and firm-level exposures;classification systems, clusters and networks; firm-level internationa-lisation; international business strategy; attracting and benefitingfrom FDI; corporate and institutional governance; and behaviouralperspectives, culture and the demise of the representative agent.

© 2012 Elsevier B.V. All rights reserved.

Keywords:Emerging marketsTransitionFinance and growth

JEL classification:F23F36G10G20G30O10

Contents

1. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1602. Classifying EM research and identifying its dissemination . . . . . . . . . . . . . . . . . . . . . 161

2.1. Classifying recent EM research. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1622.2. The dissemination of EM research in peer-reviewed journals . . . . . . . . . . . . . . . . 164

3. Recent trends in EM research . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 164

nal, corporate and individual behaviours in emerging and subsistence market-ool, Marseilles and DEFI Aix-Marseilles University, Aix-en-Provence, September

ersity, 27 Sir John Monash Drive, Caulfield East, Victoria 3145, Australia.

All rights reserved.

http://dx.doi.org/10.1016/j.ememar.2012.01.003

mailto:[email protected]

http://dx.doi.org/10.1016/j.ememar.2012.01.003

http://www.sciencedirect.com/science/journal/15660141

160 C. Kearney / Emerging Markets Review 13 (2012) 159–183

4. Promising avenues for future research . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1654.1. Data and methods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1674.2. Market efficiency, risk-adjusted returns and risk premia . . . . . . . . . . . . . . . . . . 1694.3. Exchange rate volatility and firm-level exposure . . . . . . . . . . . . . . . . . . . . . . 1704.4. Classification systems, clusters and networks. . . . . . . . . . . . . . . . . . . . . . . . 1714.5. Firm-level internationalisation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1734.6. International business strategy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1734.7. Attracting and benefiting from FDI . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1744.8. Corporate and institutional governance . . . . . . . . . . . . . . . . . . . . . . . . . . 1754.9. Behavioural perspectives, culture and the demise of the representative agent . . . . . . . . 176

5. Summary and concluding comments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 178

References. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 178

1. Introduction

The world's emerging markets have become the focus of sustained research in the past two decades.This has arisen for a number of reasons. Emerging markets comprise the majority of the world's peopleand land, and they continue to grow faster than the developed world. They are increasingly recognisedas a diverse set of business, cultural, economic, financial, institutional, legal, political and social environ-ments within which to test, reassess and renew received wisdoms about how the business world works,to gain deeper insights into prevailing theories and their supporting evidence, and to make new discover-ies that will enhance human welfare in all environments including the world's poorest countries, the de-veloping world, the transition countries and the developed world. In addition, emerging market (EM)research is a fascinating multidisciplinary area that incorporates disciplines as disparate as anthropology,genetics, geography, history, philosophy, psychology, physics and sociology in addition to the standardbusiness disciplines of economics, finance, international business and management.

The extensive and diverse EM literature that has mushroomed in the past decade and a half providesample opportunity for periodic assessment of where the various research agendas are heading, and the lit-erature has been reviewed by others. Notable examples include Fifield et al. (1999) who examined the cri-teria defining emerging markets and summarised the previous two decades' work, focussing mostly onequity markets. Bekaert and Harvey (1997, 2003) reviewed research on finance in emerging markets, fo-cussing mainly on the 20 countries with the longest available spans of data on the International FinanceCorporation's (IFC) emerging market database. They split their periods of analysis into the pre-1990 andpost-1990 periods because of the clustering of market liberalisations that occurred at that time, andtheir analysis focused largely on market liberalisation and integration. In addition to suggesting areassuch as formal modelling of liberalisation and reform processes; agency, corporate governance, manage-ment and the legal environment; infrastructure, demographics and politics; and microstructure in less-than-ideal environments; the authors pinpointed the fact that most EM research up until then tended toconcentrate on country-level aggregate indices, and that a future focus on firm-level analysis would befruitful. Other researchers have provided surveys of topics in EM research. Khilji (2003) reviewed financialcrises; Phylaktis (2006) focused on asset management, contagion, corporate finance and market integra-tion; and Lien and Zhang (2008) surveyed derivative markets. More recently, Fan et al. (2011) providean authoritative overview of how key institutional forces in emerging markets such as government qual-ity, the extent of state ownership, and the degree of financial development, impact upon the structuresand behaviours of firms including their investments, financing, governance and growth. They suggestareas for new EM research including government incentives, informal enforcement procedures, familyfirms and network organisations.

In this survey, we focus on economics, finance, international business and management. While notclaiming to survey the entire EM literature – which is too vast to cover in its entirety – we demon-strate the extraordinary growth in the breadth and depth of this dynamic research agenda. We beginin Section 2 by scoping out the main agendas in EM research. To do this, we reconfigure the Journalof Economic Literature (JEL) classification system to provide a comprehensive list of the topics thathave been studied. We then combine this with the Thomson Reuters ISI Web of Knowledge and

161C. Kearney / Emerging Markets Review 13 (2012) 159–183

other journal search and ranking methodologies, including the SCImago Journal & Country Rank (SJR)measures, to identify the main journals in which significant quantities of EM research has been dis-seminated. This facilitates our mapping in Section 3 of the areas and issues that have been coveredintensively in recent EM research, and it also helps us identify the areas that have received relativelyless attention. In Section 4, we point to the newest areas of research that seem promising for futureresearch. In doing so, we focus on nine topics: Data and methods; market efficiency, risk-adjustedreturns and risk premia; exchange rate volatility and firm-level exposures; classification systems,clusters and networks; firm-level internationalisation; international business strategy; attractingand benefiting from FDI; corporate and institutional governance; and behavioural perspectives, cul-ture and the demise of the representative agent. The final section summarises our findings anddraws together our main conclusions.

2. Classifying EM research and identifying its dissemination

Although the term is in common usage, there is no generally agreed consensus on either the the-oretical or operational definition of what constitutes an emerging market.1 The classification of coun-tries as emerging markets is consequently somewhat arbitrary, and is carried out and reviewed on aregular basis by a range of international financial institutions using different categories, methodolo-gies and degrees of granularity. For example, the Financial Times Stock Exchange (FTSE) uses itscountry classification review process to identify 9 ‘advanced’ and 13 ‘secondary’ emerging markets,for which it constructs indices for large and small firms.2 The ‘advanced’ countries include Brazil,the Czech Republic, Hungary, Malaysia, Mexico, Poland, South Africa, Taiwan and Turkey, and the‘secondary’ countries include Chile, China, Colombia, Egypt, India, Indonesia, Morocco, Pakistan,Peru, Philippines, Russia, Thailand and the United Arab Emirates (UAE). Bloomberg's Morgan StanleyCapital International (MSCI) emerging market index3 comprises 26 countries in three regions as fol-lows: the Americas (Argentina, Brazil, Chile, Columbia, Mexico, Peru and Venezuela), Europe, MiddleEast and Africa (the Czech Republic, Egypt, Hungary, Israel, Jordan, Morocco, Poland, Russia, South Africa andTurkey) andAsia (China, India, Indonesia,Malaysia, Pakistan, Philippines, SouthKorea, Taiwan, and Thailand).The differences are that the FTSE includes the UAEwhereas theMSCI includes Argentina, Israel, Jordan, SouthKorea and Venezuela.

Combining the various classifications yields the 27 countries shaded in Fig. 1. They are Argentina,Brazil, Czech Republic, Chile, China, Colombia, Egypt, Hungary, India, Indonesia, Israel, Jordan, Malay-sia, Morocco, Mexico, Pakistan, Peru, Philippines, Poland, Russia, South Africa, South Korea, Taiwan,Thailand, Turkey, United Arab Emirates, and Venezuela. These are the emerging countries used inthis survey. They include 4 of the top 10 countries in the world measured by purchasing power par-ity (PPP) adjusted nominal gross domestic product (GDP) — China (ranked 2), India (4), Russia (6)and Brazil (8) — the so-called BRIC countries (also known as the dragon, tiger, bear and jaguar).The emerging economies also constitute 10 of the top 20 — Mexico (11), South Korea (12), Indonesia(15), Turkey (16), Taiwan (18) and Poland (20).

There are many ways to divide the world's countries into geographic regions.4 We use the 6 continent-based regions of Africa, Asia, Europe, North and Central America, Oceania and South America. The regionalgeographic distribution of emerging markets is as follows: Africa (Egypt, Morocco and South Africa,); Asia(China, India, Indonesia, Israel, Jordan, Malaysia, Pakistan, Philippines, South Korea, Taiwan, Thailand, Tur-key and the UAE); Europe (the Czech Republic, Hungary, Poland and Russia); North and Central America(Mexico); Oceania (none); and South America (Argentina, Brazil, Chile, Colombia, Peru and Venezuela). Al-ternative regional groupingsmay be useful depending upon the context. Using the region of theMiddle Eastand North Africa (MENA) for example, 5 of the 19 countries are classified as emerging (Egypt, Israel, Jordan,Morocco and the UAE).

1 The term emerging markets was first used in the 1980s by Antoine van Agtmael, a World Bank economist.2 See http://www.ftse.com/Indices/FTSE_Emerging_Markets/index.jsp for details.3 See http://www.bloomberg.com/apps/quote?ticker=MXEF:IND for details.4 Aggarwal et al. (2011) discuss a number of alternative regional groupings and use the 6 regions employed here.

http://www.ftse.com/Indices/FTSE_Emerging_Markets/index.jsp

http://go.thomsonreuters.com/jcr/

Fig. 1. Emerging markets in 2011.


Regardless of how broadly or narrowly they are defined, emerging markets are diverse in culture,language and politics. They tend to have quite well-developed physical financial infrastructure in-cluding central banks, commercial banks and stock exchanges, but to have less well-developed pro-cesses and systems of accounting, governance, regulation and other financial infrastructure, andless efficient markets with less liquidity than the world's most advanced systems. These differenceslead to greater uncertainty and risk, and they enhance the international diversification possibilitiesfor investors from all countries in the world.

Fig. 1 shows that emerging countries make up about three quarters of the world's land mass. Al-though they account for over four fifths of the world's population, they control only one fifth of glob-al GDP. This, however, is rapidly changing. By continuing to develop their economic and socialinfrastructures, institutions and markets, and by investing in their people's education, they areexpected to grow further, to consolidate their economic and business power, and to exceed theGDP of the developed countries within two decades. The four BRIC countries are expected to over-take the G7 countries within three decades. The two largest emerging countries, China and India,are expected to lead this growth. Together, they currently graduate 1.2 million engineering and sci-ence graduates every year — equal to the EU, Japan and the United States together. It must benoted, however, that regardless of the extent to which the emerging countries are described in gen-eral or in common terms, the most interesting aspect of studying them revolves around the huge di-versity within and across many of them.

2.1. Classifying recent EM research

A useful source for organising our thoughts about the main issues in EM research is the Journal ofEconomic Literature's (2011) JEL classification system. This provides a hierarchical classification of theeconomics, finance, international business and related disciplines in 20 main categories from A to Z(excluding S to X) as follows. A — general and teaching; B — history of thought, methodology andheterodox approaches; C — mathematical and quantitative methods; D — microeconomics; E — mac-roeconomics and monetary economics; F — international economics; G — finance; H — public eco-nomics; I — health, education, and welfare; J — labour and demographics; K — law and economics;L — industrial organisation; M — business administration, marketing and accounting; N — economichistory; O — development, technological change and growth; P — economic systems; Q — agriculturaland natural resources; R — urban, rural and regional economics; Y — miscellaneous categories; andZ — other special topics.


The JEL classification system is applied to documents on the American Economic Association's Econlitwebsite.5 It includes over 1000 journals from around the world written in English or with English summa-ries, and interdisciplinary journals are also covered.6 It includes the abstracts of books with over 60 pages,such as collected essays, conference proceedings and Festschrift volumes. It also includes PhD dissertationsand research papers on the RePEc website.7 In this review, we focus almost exclusively on articles pub-lished in peer-reviewed journals and written in English. Although being far from complete, this approachallows us to limit the huge scope of work to be reviewed, while also providing an authoritative perspectiveon the currently hot research topics.

Although the JEL system uses the term ‘development’ a number of times (for example under topics ‘I’,‘O’, ‘Q’ and ‘R’), it does not include any reference to either ‘developing’ or ‘emerging’ countries, regions ormarkets. It is, nevertheless, useful to use this system to identify the main areas within EM research. We dothis by collapsing the 20 main JEL categories into 12, combining some, renaming some, and introducingsome new ones while providing brief descriptions of the sub-categories. Table 1 presents the results ofthis analysis. The 12 main categories are as follows. 1 — history of thought and of emerging markets;2 — quantitative methods; 3 — macro and public economics; 4 — micro and behavioural approaches;5 — finance; 6 — international trade and investment; 7 — growth and development; 8 — natural re-sources and the environment; 9 — industrial organisation; 10 — culture, law and other disciplines;11 — business administration and management; and 12 — miscellaneous categories.

We first apply our simplified 1–12 classifications to the EM literature by noting that many books –

including those written on special topics, handbooks, and proceedings from conferences – focus on issuesin emergingmarkets. Within the past 5 years, for example, books have been written on history (Mauro et al.,2006); business practice and strategy (Jain, 2006; Dunning and Lin, 2007; Pelle, 2007; Kvint, 2009;Ramamurti and Singh, 2009; Singh, 2010); entrepreneurship and innovation (Aidis and Welter, 2008;Yago et al., 2008; Dolfsma et al., 2009); clusters, networks, regions and supply chains (Jansson, 2007; Leeand Lee, 2007; Scott and Garofoli, 2007; Palacios, 2008; Kuchiki and Tsuji, 2010); financial markets andFDI (Batten and Kearney, 2006; Edwards, 2007; Edwards and Garcia, 2008; Hansanti et al., 2008; Sauvantet al., 2010); and stabilisation policy and growth (Kohli, 2008; Draper et al., 2009; Hammond et al., 2009).Taken together, these examples cover categories 1–3, 5–7, 9 and 11–12, and although categories 4, 8 and10 appear not to be covered, this is because the list is exemplary rather than exhaustive.

Within the academic journals, there have been many hundreds of articles. This can be illustrated byconsidering a small alphabetical listing of some recent papers on topics within the narrow range of finan-cial markets research. Such a list would include American depository receipt holdings (category 5)(Aggarwal et al., 2007; Kiymaz et al., 2009); bond market correlations (categories 2 and 5) (Bunda et al.,2009); corporate governance (category 11) (Klapper and Love, 2004); cross listing (category 6) (Siegel,2005); diversification benefits (category 5) (Li et al., 2003; Kortas et al., 2005; Lagoarde-Segot and Lucey,2007); event studies (category 2) (Bhattacharya et al., 2000); financial liberalisation (category 4) (Cunadoet al., 2006); firm-level transparency and disclosure (categories 10 and 11) (Patel et al., 2002); market effi-ciency (category 5) (Lagoarde-Segot and Lucey, 2008); raising capital (categories 5 and 6) (Pinegar andRavichandran, 2010a, 2010b); skewness and tail risk in stock returns (category 2) (Ángel Canela andPedreira Collazo, 2007; Li and Rose, 2009); and stock selection and momentum strategies (category 5)(van der Hart et al., 2003; Naranjo and Porter, 2007).

We emphasise that this list is not intended to be anywhere near complete, but it demonstrates howbroad the range of contributions is – even within the narrow range of financial markets – and it exem-plifies the extent to which a complete coverage is beyond the realm of this review. Like previous re-viewers, therefore, we must of necessity focus a personal lens on the literature that we hope will be ofinterest to readers. Informed by this, we focus our attention on English language journals that carry EMresearch and that feature in the popular public and privately-funded search engines, and our aim is tohighlight the recently topical strands of the literature and to identify some interesting directions for futureresearch.

5 http://www.aeaweb.org/econlit/doctypes.php.6 This has grown from 182 in 1969. A small number of journals in languages other than English are included under the category

‘foreign language’ journals.7 See http://repec.org.

http://www.aeaweb.org/econlit/doctypes.php

http://repec.org


We shall see presently that Table 1 can be useful to observe the areas that are well covered in EMresearch from the JEL list. It also allows us to see what areas are not yet sufficiently encompassed with-in the JEL classification system. Like other taxonomies, the JEL system evolves over time as the main re-search agendas unfold. The interested reader can see this by looking at, for example, the areas of ‘culture’and ‘behavioural finance’within the JEL system. The former appears as ‘cultural economics’ in ‘miscellaneous’topics, and it has greater prominence in our version where it appears under category 10. The latter does notyet appear in the JEL system but receives explicit treatment in category 4 of our version.

2.2. The dissemination of EM research in peer-reviewed journals

It is widely accepted that a small number of journals, such as EmergingMarkets Review, occupy centre stagein EM research in the areas of economics and finance. More generally, Table 2 presents themain journals thatfocus on EM research in the economics, finance, international business and management journals.8 Althoughnot all journals in this Table are devoted specifically to emergingmarkets, a number of themexplicitlymentionemergingmarkets in their editorial statements. Othersmention either comparative studies, developing or lessdeveloped countries, emergingmarkets, transition economies or some combination of these. All journals havebeen vetted for their inclusion of significant numbers of papers on EM themes and issues. These papers fre-quently mention ‘emerging markets’ in their title or abstract. Many, however, do not explicitly mention thisterm, although they are relevant to the issues or they are country studies of the classified emerging markets.

The Table 2 lists 47 journals. For each entry, we provide the journal title; the name of the publisher;the year of the first issue; whether the journal's editorial statement specifically refers to one or more of‘developing’ (D), ‘emerging’ (E) or ‘transition’ (T) economies or markets; and the impact factor (IF) in2010 where applicable. Of the 47 journals, there are 15 ‘D's — American Economic Journal: Macroeconomics,Economic Change and Restructuring, Economic Development Quarterly, Economic Systems, International ResearchJournal of Finance and Economics, Journal of Development Economics, Journal of Development Studies, Journal ofInternational Trade and Economic Development, Review of Development Economics, Review of International Eco-nomics, Review of Middle East Economics and Finance, Transformations and Business & Economics, World BankEconomic Review, World Bank Research Observer, and World Development. There are five ‘E's — Economic Sys-tems, Emerging Markets Finance and Trade, Emerging Markets Review, Global Economic Review, and the Interna-tional Journal of Business and Finance Research. There are eight ‘T's — Economic Change and Restructuring,Economic Systems, International Finance, International Journal of Finance and Economics, International ResearchJournal of Finance and Economics, Journal of Comparative Economics, Journal of East West Business, andthe Review of Development Economics. There are four journals that are both ‘D’ and ‘E’ — Economic Changeand Restructuring, Economic Systems, International Research Journal of Finance and Economics, and the Reviewof Development Economics. Only one journal mentions all three in its editorial statement: Economic Systems.

While it is not possible to assure complete coverage of all journals within the confines of this review,we shall see that this is not critical to our conclusions. One feature that becomes immediately apparentis the breadth and depth of research on EM issues that appear in the journals. We now apply our EM re-search classification scheme to sharpen our focus on the dominant themes and trends.

3. Recent trends in EM research

Focussing on only the most recent contributions that have appeared (or are forthcoming at the time ofwriting) in the journals listed in Table 2 during the past two years yields the following list of representa-tive papers across the twelve categories in Table 1. In performing this exercise, we have categorised thearticles under their main research focus, disregarding (for simplicity of presentation) the possibility ofmultiple categorisations which arise.

▪ Category 1 (History of thought and of emerging markets) includes Moschella (2010).▪ Category 2 (Quantitative methods) includes Turgutlu and Ucer (2010), Bruton et al. (2011), Walid et al.(2011), Aysun and Guldi (2012) and Beirne et al. (2012).

8 The journals have been ranked by SCImago Journal & Country Rank (SJR), see http://www.scimagojr.com/journalsearch.php?q=17700156323&tip=sid.

http://www.scimagojr.com/journalsearch.php?q=17700156323&tip=sid

http://www.scimagojr.com/journalsearch.php?q=17700156323&tip=sid


▪ Category 3 (Macro and public economics) includes Blanchard et al. (2010), Bleakley and Cowan (2010),Durdu and Sayan (2010), Ebecka and Ehrhartb (2012), Goyal (2011), Huang et al. (2011), Taguchi(2011) and Rocha and Moreira (2012).

▪ Category 4 (Micro and behavioural approaches) includes Braun and Raddatz (2010) and Clausen et al.(2011).

▪ Category 5 (Finance) includes Al-Hassan et al. (2010), Angelidis (2010), Ismailescu and Kazemi (2010),Mihaljek and Packer (2010), Moshirian et al. (2010), Pinegar and Ravichandran (2010a,b), Cole et al.(2011), Fan et al. (2011), Olson and Zoubi (2011), Al-Sakka and Gwilym (2012), Flavin and O'Connor(2010) and Jahan-Parvar and Waters (2012).

▪ Category 6 (International trade and investment) includes Krammer (2010), Demir and Dahi (2011),Espinoza et al. (2011), Faria et al. (2011), Hanousek et al. (2011), Kenourgios and Samitas (2011),Kejzar (2011) and Santangelo and Meyer (forthcoming).

▪ Category 7 (Growth and development) includes Bleaney and Castilleja Vargas (2009), Rugman (2010)and Coricelli and Maurel (2011).

▪ Category 8 (Natural Resources and the environment) includes Fayyad and Daly (2011).▪ Category 9 (Industrial Organisation) includes Koveshnikov (forthcoming), Liu et al. (2011), Nitin andWu (forthcoming) and Reimann et al. (2012).

▪ Category 10 (Culture, law and other disciplines) includes Lucey and Zhang (2010), Aggarwal et al.(2012), Kling and Weitzel (2011), Love (2011) and Sharma (2011).

▪ Category 11 (Business Administration) includes Hossain et al. (2010), Kaja and Werker (2010) andHearn (2011).

▪ Category 12 (Miscellaneous categories) includes Aggarwal et al. (2011), Hutson, Sinkovics and Berrill(2011) and Kraeussl and Logher (2012).

Five observations pertaining to the directions of recent EM research are of interest. First, in addition tothe dedicated EM journals, many of the more ‘mainstream’ journals in economics, finance, internationalbusiness and management that do not indicate in their editorial statements that they are particularly in-terested in EM research have nevertheless recognised the value of emerging markets as valuable testinggrounds for received theory and new approaches. Second, there is considerable disparity of outputacross the categories. Some, such as 3 (Macro and public economics), 5 (Finance), and 6 (Internationaltrade and investment) are very well represented. Others, such as categories 2 (Quantitative methods),7 (Growth and development), 9 (Industrial Organisation), 10 (Culture, law and other disciplines) and11 (Business Administration) have what we might term ‘medium’ output. Third, closer inspection ofthe journals in which this research has been published reveals that the leading international businessand management journals have been very proactive in publishing articles on firm-level operationsand strategies in emerging markets. Fourth, and perhaps most interestingly, this exercise identifiesthat some areas seem to be relatively under-researched, and these include categories 1 (History ofthought and of emerging markets), 4 (Micro and behavioural approaches), 8 (Natural Resources and theenvironment), and 12 (Miscellaneous categories). Finally, this closely mirrors the coverage (and relativelack thereof) of the categories in our brief look at the EM research that has been disseminated in bookform, which incidentally confirms the consistency of our modified JEL system to classify the EMliterature.

4. Promising avenues for future research

The surveys by Bekaert and Harvey (1997, 2003), Khilji (2003), Phylaktis (2006), Lien and Zhang(2008) and Fan et al. (2011) have collectively suggested the merits of future research on the followingtopics: agency issues; asset management; corporate finance; corporate management and governance; de-rivative markets; family firms; financial crises; firm-level analysis; formal modelling of liberalisation andreform processes; government incentives; informal enforcement procedures; infrastructure, demo-graphics and politics; legal environments; market integration and contagion; microstructure in less-than-ideal environments; and network organisations.

There is already excellent work proceeding along these paths, and researchers are gaining insightsabout the necessity to study individual and group optimising and decision-making under a richer set of


behavioural assumptions and approaches. There are myriad research opportunities to be exploited, andquestions and answers to be found amongst the many dimensions of interaction between people, firms,industries, institutions, markets and countries. Rozelle et al. (2002) are exemplary in their assessmentof the socio-economic conditions needed to ensure the successful transformation of China's rural agricul-tural sector, which is the largest peacetime demographic movement from rural to urban settings. They

Table 1Classifying emerging market research.

1: History of thought and of emerging marketsThis includes the main schools of thought such as the pre-classical, classical, neoclassical, socialist and Marxist approaches; evo-lutionary and institutional analyses; general, comparative and international studies of emerging markets throughout theworld, its regions, countries and industries, divided into pre- and post-World War 1; analysis of capitalist, cooperative and so-cialist enterprises in capitalist, socialist and transitional emerging markets.

2: Quantitative methodsThis is one of the most relevant categories that cuts across all sub-disciplines, topics and levels of analysis in EMR. It includesmathematical, econometric, computational methods applied to cross-section, panel and time series datasets; nonparametrics;spatial and longitudinal analysis of macroeconomic, microeconomic and survey datasets; neural networks, clustering and sim-ulation studies; dynamic, evolutionary and stochastic game theory; and laboratory and field experiments on individuals,groups and sector-specific institutions and markets.

3: Macro and public economicsThis includes macroeconomic modelling; stabilisation policies for output, employment, wages and inflation; the structure, scope,processes and performance of government; budgetary processes, loans, revenues, taxation, grants, subsidies and their effectson people and firms; intergovernmental and inter-jurisdictional relations; externalities and public goods; infrastructure in-vestment and project evaluation; debt and its management.

4: Micro and behavioural approachesThis includes consumer and producer theory and policy; the design and regulation of organisations and markets; behaviouralapproaches, transaction costs and property rights; income distribution, inequality, justice and altruism; social choice,political processes and rent-seeking; bureaucracy in administrative processes, corruption and conflict.

5: FinanceThis includes financial market and institutional efficiency; asset pricing and portfolio theory; investments, mergers andacquisitions; corporate governance and regulation; risk measurement and management; the role of money, finance and thefinancial system; and the determinants of saving and investment.

6: International trade and investmentThis includes positive and normative trade theories and policies; economic and financial contagion and integration; institutions,policies and coordination; lending, indebtedness and aid; geographic and international worker mobility.

7: Growth and developmentThis includes population demographics (fertility, child care, the aged, the handicapped); labour supply and demand; humancapital, productivity and pay; macroeconomic, microeconomic, financial, geographic and industrial analysis of thedevelopment and growth process by industry, markets and institutions; analysis of urban-regional development, infrastruc-ture, trade, government planning and policy; land-use regulations and housing markets; infrastructure and transport; generaland spatial analysis of regional growth and development; single and cross-country studies and convergence; and inequality ineducation, health, welfare and poverty.

8: Natural Resources and the environmentThis includes analysis of natural resources, sustainable development, conservation and pollution generally as well as within themain sectors of air, land and water; agriculture, fisheries, air quality studies; commodity prices; renewable resourcemanagement; and environmental protection and biodiversity.

9: Industrial OrganisationThis includes market and firm structure, strategy and performance; entrepreneurship; transactional relationships, jointventures, licencing, networks and reputation; public enterprises and nonprofit organisations; sectoral studies and industrypolicy; public utilities and infrastructure provision; and higher education and research.

10: Culture, law and other disciplinesThis includes legal systems, procedures and the rule of law; the basic areas of law (contract, property, tort and criminal);business regulation, antitrust and securities law; personal, family and tax law; and international law; interdisciplinaryapproaches such as anthropology, genetics, psychology, sociology.

11: Business AdministrationThis includes accounting, auditing, international business; marketing; personnel management, industrial relations and executivecompensation; corporate culture and social responsibility; workers' rights and trade unions; discrimination (minorities, raceand gender, preferences); and new firms and start-ups.

12: Miscellaneous categoriesThis includes book reviews, collected works, dissertations and handbooks; wider readings in related disciplines and data; andthe teaching of emerging markets at university, and other topics.


describe how the debate is balanced between the optimists who emphasise the rapid growth of off-farmemployment, increasing specialisation, more education, research and development expenditures, andgrowing trade — and the pessimists who focus more on the poorly functioning land and labour markets,the risks of stagnant agricultural incomes, and the disparities between rural and urban areas. They de-scribe the pivotal roles of well-functioning land tenant institutions and labour markets for cross-industry transformation and migration. This provokes the reader to think of the full set of interplays be-tween people, institutions and markets in other developing, emerging and transition economies, and toconsider the implications of these interplays for currently received wisdoms, approaches, theories andideologies.

We now identify and briefly discuss some key issues for future research under the following headings:Data and methods; market efficiency, risk-adjusted returns and risk premia; exchange rate volatility andfirm-level exposures; classification systems, clusters and networks; firm-level internationalisation; inter-national business strategy; attracting and benefiting from FDI; corporate and institutional governance;and behavioural perspectives, culture and the demise of the representative agent.

4.1. Data and methods

Within the academic journals generally, and particularly in the areas of interest to EM researchers, theavailability of new data and new methods of obtaining and analysing data (category 2 in our EM classifi-cation system in Table 1) are becoming increasingly important for producing competitive and interestingresearch with real impact. In this vein, Naranjo and Porter (2007) examine almost 16,000 firms from 22developed and 18 emerging markets from 1990 to 2004 to confirm the profitability of momentum tradingstrategies in both developed and emerging markets. They show that the diversification benefits are largerin emerging than developed markets. Dethier et al. (2011) review the literature that uses enterprise sur-veys to examine the impact of business climate variables on productivity and growth in developing andemerging countries. They show that variables such as competition, finance, infrastructure, regulationand security impact significantly on firm performance, and they conclude that favourable business cli-mates promote growth by raising productivity and encouraging investment. In doing so, they suggest fu-ture research avenues and how to improve upon survey design. Günther et al. (2009) use the HalleInstitute for Economic Research's IWH FDI firm-level database of 809 foreign subsidiaries in Central andEast Europe to show that FDI to the region is dominated by market- and efficiency-seeking motives ratherthan by attempts to internalise local knowledge, skills, and technology. Using the gravity model with paneldata econometrics, Harb (2010) studies how the internet and institutional efficiency affects EU–Arabtrade. He generates a series of simulations to show how these factors can significantly raise Arab importsfrom the EU, and this allows him to identify sectoral reform priorities at both the country and regionallevels.

More recently, Beck and Brown (2011) use the European Bank for Reconstruction and Development's(EBRD) Life in Transition Survey (LITS) database for 29,000 households from 29 transition economies (in-cluding the Czech Republic, Hungary, Poland, Russia and Turkey) to study how the demand for bank ser-vices relates to family characteristics, bank ownership structure and the development of the country'sfinancial infrastructure. They find that bank account or bank card usage rises with income, wealth and

Notes to Table 1:Notes. The Journal of Economic Literature (JEL) classification scheme divides the economics and related disciplines into 20 main cat-egories from A to Z (excluding S to X) as follows. A — General Economics and Teaching; B — History of Economic Thought, Method-ology, and Heterodox Approaches; C — Mathematical and Quantitative Methods; D — Microeconomics; E — Macroeconomics andMonetary Economics; F— International Economics; G— Financial Economics; H— Public Economics; I— Health, Education, andWel-fare; J — Labour and Demographic Economics; K — Law and Economics; L — Industrial Organisation; M — Business Administrationand Business Economics; Marketing; Accounting; N — Economic History; O — Economic Development, Technological Change, andGrowth; P — Economic Systems; Q — Agricultural and Natural Resource Economics; Environmental and Ecological Economics; R —

Urban, Rural, and Regional Economics; Y — Miscellaneous Categories; and Z — Other Special Topics. These categories have varioushierarchical sub-categories. See the American Economic Association website at www.aeaweb.org/jel/jel_class_system.php. In thisTable, we have summarized the JEL classification scheme by combining some of the headings and providing brief descriptions ofthe sub-categories. Specifically, the categories above combine the JEL categories ‘A’, ‘P’ and ‘Y’; ‘B’ and ‘N’; ‘E’ and ‘H’; ‘I’ and ‘L’; in-troduces the new category ‘10’, and makes some other minor changes.

Table 2Emerging market journals.

American Economic Journal: Macroeconomics, AEA, 2009, D, IF: 0.158.Applied Economics Letters, Taylor & Francis, 1994, IF: 0.245.Applied Economics, Taylor & Francis, 1961, IF: 0.424.Applied Financial Economics, Taylor & Francis, 1980.Asia Pacific Journal of Management, Springer, 1983, IF:3.355.Asian Economic Policy Review, Wiley, 2006, IF: 0.622.Asia-Pacific Journal of Financial Studies, Korean Securities Association, 1961.China Economic Review, Elsevier, 1989, IF: 0.947.Economic Change and Restructuring, Springer, 1961, D, T.Economic Development Quarterly, Sage Publications, 1987 D, IF: 1.059.Economic Systems, Elsevier, 1976, D, E, T.Emerging Markets Finance and Trade, M.E. Sharpe, 1964, E, IF: 0.444.Emerging Markets Review, Elsevier, 2000, E.Global Economic Review, Taylor & Francis, 1971, E, IF: 0.130.Global Journal of Business Research, IBFR, 2007.IMF Economic Review, Palgrave Macmillan, 1950, IF: 0.768.International Business Review, Elsevier, 1992, IF: 1.489.International Economics and Economic Policy, Springer, 2004.International Finance, Wiley Blackwell, 1998, T, IF: 0.462.International Journal of Business and Finance Research, IBFR, 2007, E.International Journal of Emerging Markets, Emerald, 2006.International Journal of Finance and Economics, Wiley Blackwell, 1995, T, IF: 0.569.International Research Journal of Finance and Economics, European Journals, 2009, D, T.International Review of Economics and Finance, Elsevier, 1992, IF: 0.809.International Review of Financial Analysis, Elsevier, 1992.Journal of African Economies, Oxford Journals, 1992, IF: 0.516Journal of Comparative Economics, Elsevier, 1972, T, IF: 0.835.Journal of Development Economics, Elsevier, 1974, D, IF: 1.747.Journal of Development Studies, Taylor & Francis, 1964, D, IF: 0.793.Journal of East West Business, Routledge, 1984, T.Journal of International Business Studies, Palgrave Macmillan, 1960, IF: 4.184.Journal of International Financial Markets, Institutions and Money, Elsevier, 1991.Journal of International Management, Elsevier, 1994, IF: 1.298.Journal of International Money and Finance, 1982, IF: 0.863.Journal of International Trade and Economic Development, Taylor & Francis, 1991, D, IF: 0.314.Journal of World Business, Elsevier, 1965, IF: 1.986.Research in International Business and Finance, Elsevier, 2004.Review of Development Economics, Wiley, 1997, D, T, IF: 0.434.Review of International Economics, Wiley, 1992, D, IF: 0.614.Review of International Political Economy, Taylor & Francis, 1994, IF: 0.861.Review of Middle East Economics and Finance, Berkeley Electronic Press, 2005, D.Review of Pacific-Basin Financial Markets and Policies, World Scientific, 1998.Review of World Economics, 1864, Springer, 0.966.Transformations in Business & Economics, 2000, Vilnius University, D, IF: 1.670World Bank Economic Review, Oxford Journals, 1987, D, IF: 1.766.World Bank Research Observer, Oxford Journals, D, IF: 1.474.World Development, Elsevier, 1964, D, IF: 1.612.

Notes. IBFR denotes the Institute for Business and Finance Research. The journal Economic Change and Restructuring was previouslycalled Economics of Planning; IMF Economic Review was previously called the IMF Staff Papers; the Review of World Economics waspreviously called Weltwirtschaftliches Archiv. The capital letters ‘D’, ‘E’ and ‘T’ that indicate whether the journals' editorialstatements refer to ‘developing’, ‘emerging’ or ‘transition’ economies or markets. Where appropriate, the journals' impact factor(IF) from the 2010 Journal Citation Reports® (Thomson Reuters, 2011) are also provided.


education in most countries, and that evidence of social integration, urban–rural and religious effects arealso present. Of much interest is their finding that foreign bank ownership is associated with more bankaccounts amongst high-wealth, high-income, and educated households, and that State ownership ofbanks does not induce financial inclusion amongst poorer or rural households.

Bruton et al. (2011) use qualitative case studies to examine the success and failure characteristics ofmicro-lending in Guatemala and the Dominican Republic. Although the authors refer somewhat loosely


to these economies as ‘emerging’, their intention is clear to place the discipline and some of the method-ologies of international business within the field of developing economy finance. It seems inevitable thatuseful insights will be gained by applying this kind of analysis on micro databases to a wider set of issuesin emerging market finance and other sub-disciplines. Cole et al. (2011) use field surveys in Indonesianvillages to study the demand for financial services in emerging markets. Once again, this methodology isbecoming increasingly popular in its credibility to illicit qood quality research findings on diverse topicsusing micro datasets. Ebecka and Ehrhartb (2012) use panel estimation techniques on a very interestingdataset on the composition of tax revenues for 37 sub-Saharan African countries from 1980 to 2005.They show that unstable government tax revenues causes unstable public spending and lower publicinvestment, and that indirect taxation-based systems have a robust stabilising effect. This issue is de-serving of further analysis in emerging and transition economies — and even in the world's devel-oped economies given recent developments within some European countries and the United States.

Dethier et al. (2011) provide an authoritative review of the extensive literature on the extent to whichbusiness and investment climates can spur investment and growth. They argue convincingly that country-level macroeconomic studies have limitations due to endogenity problems in identifying the importantchannels of influence; they obscure heterogeneity across regions and firms (type, ownership, age, size, in-dustry and degree of internationalisation9); they lack robustness due to limited sample size in cross-section studies; they provide insufficient information on the weights of causal factors on individualfirms; and their invariance over time makes it difficult to distinguish the effects of business and invest-ment climate variables from other fixed effects at the level of the country, region or industry. By contrast,the firm-level studies show that within-country heterogeneity is important; that local business climatesdo influence firm-level performance; and that the considerably larger data sets provide opportunities togenerate more robust insights.

A related literature on textual sentiment analysis has made new contributions to our understanding ofthe role of information and news in determining financial asset prices. The early work on the role of newsused easily quantifiable aspects of news as a proxy for the news itself, such as the timing of news, the vol-ume of news (number of words), and the type of news (periodic announcements and general publiclyavailable news). By contrast, the recent literature on text-based sentiment extracts sentiment from qual-itative verbal information (e.g. corporate disclosures, news stories), and examines how textual sentimentgets transmitted to asset prices. The verbal information is not confined to texts, however; it can increas-ingly include information from speeches, audio, television and video recordings. The main protagonists in-clude Antweiler and Frank (2004), Tetlock (2007), Das and Chen (2007), Tetlock et al. (2008) andLoughran and McDonald (2011), and the literature is reviewed by Ahmad et al. (2011). Taken together,this work points to how language contains important new information which has incremental explanatorypower, and it will be interesting to see these studies will be extended to the many and varied contexts ofemerging markets.

It seems certain that further developments in the quantity, quality and diversity of EM research will in-clude the use of hitherto under-used approaches to data generation such as longitudinal sampling, casestudies and field experiments. These approaches will facilitate the construction of increasingly noveland sizeable datasets, which combined with ongoing developments in modelling and testing, promise toyield interesting and insightful perspectives on the myriad issues in EM research. We shall see thatsome of these developments are already happening in the areas we discuss now.

4.2. Market efficiency, risk-adjusted returns and risk premia

We have seen that emerging countries tend to have moderately developed equity markets that func-tion with imperfect efficiency. Unsurprisingly, the empirical evidence on their market efficiency has pro-duced mixed results. The early work by Bekaert and Harvey (2003) concluded that emerging markets areless informationally efficient than their developed counterparts. More recently, Al-Khazali et al. (2007)failed to reject the random walk hypothesis for the MENA markets, Hoque et al. (2007) found that stockprices in most Asian developing countries do not follow a random walk, and Lagoarde-Segot and Lucey

9 The latter two dimensions are not mentioned by the authors, but are featured in the firm-level classification system of Aggarwalet al. (2011).


(2008) found mixed evidence of equity market efficiency in the MENA region. In reviewing prior studies,the latter authors outlined several factors that hinder the flow of information in thinly traded emergingmarkets, including structural and institutional factors such as political and economic uncertainties; limitedtransparency of fundamental information due to scarce corporate information, weak regulation, low audit-ing experience and lax disclosure requirements; lack of competition amongst dominant players who canmove prices away from intrinsic values; incompletely developed ‘culture(s) of equity’ that reduce the re-action speeds of market participants to new information; and the resulting illiquidity that impedes themarket's capacity to accommodate orders.

It is these characteristics that raise the risks to investors in emerging markets, and the received wisdomin finance suggests that the proportion of this risk that cannot be eliminated by diversification shouldcommand an appropriate risk premium. Indeed, a significant part of the allure of emerging markets for in-vestors lies in the belief that they provide diversification benefits that allow them to obtain higher risk-adjusted returns than those obtainable from not including such markets in their portfolios. To illustratethe potential benefits of investing in emerging markets, we reproduce some results from Berrill andKearney (2011) that show monthly market returns from January 2000 to May 2010, for the Datastream‘developed’, ‘emerging’ and ‘world’ indices; the FTSE ‘developed’, ‘emerging’ and ‘world’ indices; and theMSCI ‘BRIC’, ‘emerging market’, and ‘world’ indices. Panel A of Table 3 shows the monthly returns, standarddeviations, and return-risk ratios for each index over the full period. We can see that the emerging mar-kets tend to have higher returns, but they also have higher volatilities. The highest return-risk ratios arefor the emerging market indices — regardless of which measure is used. Clearly, the emerging marketshave ex-post outperformed the ‘developed’ and ‘world’ markets over the past decade.

To see whether the international banking and finance crisis of 2007 has had any impact on these re-sults, the data are segregated into two sub-samples using October 15, 2007 as the cut-off point. Panels Band C of Table 3 present these results. The return-risk ratios are positive for all indices before the crisisand negative for all indices after the crisis, but the ranking of indices is similar before and after the crisis.Emerging market indices are again the best performers. This suggests that the crisis has had little impacton the relative performance of these indices for this time period. Future work will undoubtedly focus onfurther analysis of the risk-return nexus and the risk premium in emerging equity markets.

Donadelli and Prosperi (2011) provide a detailed review of work to date on the risk premium, and alarge number of studies have addressed related issues such as market integration, contagion and volatilityspillovers. Despite a great deal of effort, the literature remains at an early stage of the journey towards acomplete understanding of the complex set of structural, institutional, cultural and regulatory factorsthat determine both cross section and time series variations in risk-adjusted returns and risk premiums.There remains much work in extending these efforts to include more markets such as bond, commodities,foreign exchange, metals and their derivatives, using the latest testing techniques on much more finelygranulated datasets as they become available.

4.3. Exchange rate volatility and firm-level exposure

Using a 20-year sample of 3788 firms from 23 countries (including some emerging markets), Hutsonand Stevenson (2010) show that controlling for firm size, industry and several financial variables, firmsin open economies is more exposed to exchange rate movements than firms in relatively closed econo-mies. They also report a strong inverse relation between firms' exchange exposure and the extent of cred-itor protection in the countries in which they operate. They argue that this is consistent with managersacting to reduce the likelihood of financial distress in countries with high bankruptcy costs, and theypoint to the importance of institutional incentives in encouraging value-enhancing risk managementactivities.

Guglielmo et al. (2011) examine non-stationary panels of real exchange rates in a sample of 39 devel-oping countries from Asia, MENA and Latin America. They find that international financial integrationleads to long-run real exchange rate depreciation, and that misalignments reveal over-valuation in mostAsian and Latin American countries and under-valuation in most MENA countries. Ye and Hutson(2011) use daily equity data to show that most of the 14 Chinese listed banks are highly exposed to theRMB/USD exchange rate, and that they were even more exposed during the post-crisis period despitethe renminbi's reversion to a de facto peg against the US dollar in 2008. They show that this cannot be

Table 3Return and risk in emerging, developed, and world markets, January 2000–May 2010.Source: Berrill and Kearney (2011).

Index Mean return Standard deviation Return-risk

Panel A. Entire sampleDatastream ‘emerging’ 1.120 7.211 0.155FTSE ‘emerging’ 0.783 5.968 0.131MSCI ‘BRIC’ 1.102 8.616 0.128MSCI ‘emerging’ 0.756 7.348 0.103Datastream ‘world’ 0.067 5.383 0.012FTSE ‘world’ 0.012 5.321 0.002Datastream ‘developed’ −0.007 5.475 −0.001FTSE ‘developed’ −0.050 5.198 −0.010MSCI ‘world’ −0.091 5.182 −0.018

Panel B. Pre-crisis periodDatastream ‘emerging’ 1.566 5.395 0.290FTSE ‘emerging’ 1.138 5.103 0.223MSCI ‘BRIC’ 1.595 7.187 0.222MSCI ‘emerging’ 1.143 5.886 0.194Datastream ‘developed’ 0.422 4.191 0.101Datastream ‘world’ 0.403 4.008 0.100FTSE ‘world’ 0.337 3.914 0.086FTSE ‘developed’ 0.280 3.856 0.073MSCI ‘world’ 0.233 3.848 0.061

Panel C. Post-crisis periodDatastream ‘emerging’ −0.176 10.924 −0.016MSCI ‘BRIC’ −0.331 11.867 −0.028FTSE ‘emerging’ −0.250 7.980 −0.031MSCI ‘emerging’ −0.371 10.559 −0.035Datastream ‘world’ −0.910 8.180 −0.111FTSE ‘world’ −0.933 8.1570 −0.114FTSE ‘developed’ −1.011 7.916 −0.128MSCI ‘world’ −1.034 7.890 −0.131Datastream ‘developed’ −1.254 8.100 −0.155

Notes. This table shows the monthly mean return, standard deviation, and return-risk ratios for nine indices from January 2000 toMay 2010: the MSCI ‘BRIC’, ‘emerging market’, and ‘world’ indices; the Datastream ‘developed’, ‘emerging’ and ‘world’ indices; andthe FTSE ‘developed’, ‘emerging’ and ‘world’ indices. Panel A shows the results for the full sample, and Panels B and C present theresults for the pre-crisis period and the post-crisis period, defined as October 2007. The emerging market indices exhibit the highestreturn-risk ratios, regardless of which index provider is used, and the ranking is similar before and after the crisis.


explained by direct foreign exchange exposures, and that China's banks are subject to substantial indirectexposure as a result of concerns about their loan books in the face of anticipated further appreciation ofthe renminbi.

Related work by Udomkerdmongkol et al. (2009) uses fixed and random effects to allow for country-specific, time-invariant effects on annual data for 16 emerging market economies (including Chile,China, Colombia, Malaysia, Morocco, Pakistan, the Philippines, South Africa, Thailand and Venezuela) tostudy how actual exchange rates and exchange rate volatility impacts on inward FDI from the UnitedStates. Intuitively, expected depreciation and volatility deter FDI. It will be useful to further extend theexisting work on exchange rate exposures within emerging markets using more finely granulated dataat the firm level, to discover further insights on how this impacts on many aspects of these countries' eco-nomic and institutional progress.

4.4. Classification systems, clusters and networks

Classification systems are widely used in theoretical and empirical analysis in many disciplinesthroughout the arts, humanities, physical and social sciences. By focusing on agreed sets of characteristicdimensions, classification systems condense and organise information to facilitate comparison and


contrast between object types (and study findings) within and across populations. Many are well known,such as the Linnaeus hierarchical classification of plants and animals, the periodic table of chemical ele-ments, the Dewey library classification system, and the Myers–Briggs personality types. In the manage-ment disciplines, a number of typologies and classification schemes have been particularly influential,10

and many EM researchers readers will be familiar with the North American industry classification system(NAICS) that classifies industries at increasing levels of specificity, the Journal of Economic Literature (JEL)system that organises the business disciplines into 20 main categories, and Hofstede's (2001) typology ofcultural types. A number of authors have developed high-level typologies of aspects of MNEs' operations.The best-known of these include Perlmutter's (1969) typology of managerial mindsets (home country ori-ented, host country oriented,world oriented); Bartlett and Ghoshal's (1989) typology of MNE organisationalstructure and strategy (multidomestic, international, transnational and global); Dunning's (1993) typologyof FDI objectives (market-seeking, efficiency-seeking, resource-seeking, and strategic-asset seeking); andRugman's (2003) typology of MNE strategy (home-regional, bi-regional, host-regional and global).

Prior to Darwin's theory of evolution, biological taxonomy tended to be static insofar as entries withingroups were placed on a permanent basis. The force of Darwin's theory was to reveal that the groupsthemselves can evolve over time just as their components can evolve from one group to another. In apply-ing the phylogenic (evolving) taxonomy of biology to the social sciences in general and to organisationtheory in particular, researchers have made good use of evolutionary theory by reinterpreting it toallow the possibility of organisations evolving across groups within their taxonomic frameworks. Rich(1992) shows how evolutionary theorising leads researchers to look into the past for explanations ofthe present. This relationship between taxonomy and theory is particularly pertinent to the study ofemerging markets insofar as today's developed markets themselves ‘emerged’ at an earlier time, and thepaths and processes they followed are a useful informational source for theorising and conjecture aboutmany issues related to growth and development. We shall see examples of this under subsequent head-ings in this section.

Cluster and network analysis is also becoming increasingly popular in many applications of relevanceto EM research. An interesting study by Scott (2006) examines how the evolving economic geography oflow-technology, labour-intensive industries including clothing, footwear and furniture operate through‘dense’ networks of interrelated producers' to promote local development and economic growth at the na-tional level while also driving global trade patterns. Scott (2006) includes China, India, Indonesia, Russiaand Poland in his analysis, along with the developed economies of Italy, Japan, the United Kingdom andthe United States in his analysis, and notes that much evidence points to these industries being heavilyconcentrated in specialized industrial districts regardless of the level of development. He studies the spa-tial patterns of trade within these industries to show how the industry includes the design-intensive cen-tres of London, New York, Paris and Rome along with the supply chains that extend globally across alllevels of developing and emerging economies. Future research should extend this perspective to studythe geography of more industries and how they relate across countries and regions to form today's inte-grated business world.

Manning (2008) shows how developed-country, knowledge-based MNEs in engineering and scienceoften tend to locate close together in emerging markets. More recently, and building on the network anal-ysis of trade by Fagiolo et al. (2010), Reyes et al. (2010) use a variety of cluster and network techniqueson bilateral trade data for 171 countries from 1980 to 2005 to illustrate how trade integration shouldbe measured by more complex methods than the conventional trade-to-GDP ratios. They show thatalthough trade openness has risen in both the high-performing Asian countries and in Latin America,the former have become more integrated within the global trading system. By contrast, the LatinAmerican region has not increased its global trading network integration as quickly, and some coun-tries have performed relatively poorly — Venezuela, for example, has become less integrated. Thiskind of analysis that uses modern, data-intensive techniques to examine trading patterns at thecountry, industry and firm levels will yield increasingly important insights into how agents in emerg-ing markets can best progress, how developed-world agents can most effectively engage with

10 For example, classification schemes for strategic groups (McGee and Thomas, 1986); manufacturing strategies (Miller and Roth,1994); multidimensional constructs (Law et al., 1998), and (Earl, 2001).


emerging markets, and it will also yield important insights into more general topics that span theeconomic geography of international trade.

4.5. Firm-level internationalisation

Although the trends towards enhanced international market integration of recent decades arewidely recognised, interpretations and operational definitions of the terms globalisation, regionalisa-tion and regionalism persist depending upon the contexts in which they are used. International inte-gration has involved increasingly global production, distribution and consumption systems, and it hasled to economic and political ideologies, knowledge and cultural identities being expressed and man-ifested in increasingly global rather than country-specific contexts. The forces of globalisation, how-ever, do not go unchallenged, because international regionalism counteracts them (Marchand et al.,1999). The regional actions of governments on issues such as international finance (managed floats,fixed pegs, currency unions and regulation of institutions) and trading agreements (preferential tar-iffs, free trade areas and economic unions) form the complex landscape within which firms operateand compete within and across geographic, cultural and political regions in developed, developing,emerging and transitional countries.

This is a complex, dynamic and increasingly important research agenda that has a number of elements.Increasing numbers of firms from developing and emerging markets are now competing with developedfirms in their own as well as in the developed markets, and correspondingly, internationalising firmsfrom the developed countries are seeking new strategies to successfully engage with the developing andemerging markets. A particularly contentious debate surrounds the extent to which the world's largestfirms (increasing proportions of which are now from emerging markets) are managing to compete glob-ally. Proponents of the triad approach to studying the geographic reach of the world's largest MNEs basetheir analysis on the observation that North America, Europe and Asia-Pacific dominate international busi-ness (Ohmae, 1985). Using the ‘extended triad’ of NAFTA, the EU-25 and Asia, Rugman and Verbeke(2004) conclude that most of the Fortune 500 firms do not operate globally.

The evidence assembled by Rugman and his co-authors in favour of regionalisation rather than global-isation of the world's largest firms has been scrutinised by Aharoni (2006), Osegowitsch and Sammartino(2007, 2008), Dunning et al. (2007) and Asmussen (2009). These researchers have introduced refinementsto the analysis to show that the evidence in favour of regionalisation is not overwhelming. Recent work byAggarwal et al. (2011) has built a classification system of firm-level internationalisation that includes allcountries and regions in the world, and therefore accommodates the activities of developed-countryfirms in emerging markets, firms from emerging markets in developed markets, and all other permuta-tions. They show that there are many trans-regional and global firms. One of the main benefits of thiswork is its inclusiveness of countries and regions. The ‘triad’ approach to delineating regions does not pro-vide a complete framework for examining the dynamics and complexities of international strategy be-cause it excludes most of the world's countries – 155 in total – and these are mainly emergingeconomies in Asia, Eastern Europe, the Middle East, South America and Africa. The IMF's and the WorldBank's list of the largest 20 economies measured by GDP in 2008 includes Brazil, China, India and Russia(the so-called BRICs) along with Indonesia and Mexico. These are all outside the narrowly-defined triad,as are many of the world's largest 50 economies — including Argentina, Nigeria, Poland, Saudi Arabiaand Turkey.

As more extensive firm-level data sets become available, EM researchers will undoubtedly use moreclassification tools to seek better understanding of the activities and strategies of firms of all types in allindustries and countries as they seek to internationalise and respond to the dynamic business landscapethat is emerging in the next few decades. This will provide a rich information source to settle current de-bates on globalisation and regionalism, and it promises to deliver new insights into the dynamics of glob-alisation in the business world.

4.6. International business strategy

Wright et al. (2005) apply international business strategy to emerging markets, and in doing so, theyreview the challenges and opportunities facing internationalising firms from the developed and emerging


countries in competing on their own and each other's markets. Peng et al. (2008) go further in suggestingthat the institution-based view of international business strategy should be added to the industry-and resource-based views to form the so-called strategy tripod. Elbadawe et al. (2006) study the ex-port performance of firms from 160 cities to shed light on how exporters from Africa struggle toovercome the challenges of geographical location and access to developed markets. Matthews(2009) describes how the ‘dragon’ multinationals from China and the tiger technologies from Indiaand elsewhere throughout Asia behave in order to survive and compete in global and developedmarkets, and Miller et al. (2008) describe how emerging market firms survive in developed markets.Kumar (2008) and Nitin and Wu (forthcoming) are representative of a dynamic literature in studyingthe internationalisation patterns, strategies and performances of emerging market firms in India andChina respectively. Demirbag and Tatoglu (2009) review the market entry and operational strategiesof firms in emerging and transition economies. Koveshnikov (forthcoming) uses a combination of 2case studies and 64 in-depth interviews with top and line managers to cast light on the modus oper-andi of successful Western firms operating in Russia. Liu et al. (2011) show how ownership structureaffects the entrepreneurial directions and internationalisation strategies in Chinese firms. Santangeloand Meyer (forthcoming) use survey methods to evaluate the process theory of internationalisationin the context of FDI in the emerging economies of Hungary, Lithuania and Poland. They find that in-stitutional voids and uncertainties affect firms' commitment to their evolving subsidiaries, and theysuggest the need for more differentiated theories of how institutional characteristics determinestrategy.

The rapid evolution of global business patterns is leading to the situation in which countries outside the‘triad’ are becoming increasingly important as destinations for FDI and exports by triad-based MNEs aswell as within global supply chains. Although global trading system is hierarchical with a core-periphery structure, smaller and emerging countries have enhanced their share of global output, particu-larly since the 2008 economic and financial crisis. It is increasingly well-understood that firms doing busi-ness in emerging markets need to adopt alternative strategies to those for developed economies,recognising the challenges and opportunities engaging with ‘micro-consumers’ in ‘mega-markets’(Gupta and Wang, 2009). The taxonomic approach suggested by Aggarwal et al. (2011) has potential use-fulness for examining trans-regional and global strategies beyond the world's most developed economies,including the strategies used by firms in developing and emerging economies to reach their own and de-veloped markets; the internationalisation strategies of ‘new’, ‘emerging’, ‘latecomer’ and ‘unconventional’MNEs from emerging markets; the skills and strategies of emerging market firms such as project execu-tion, networking, and dealing with institutional weakness and political instability. The appropriate loca-tion strategy for FDI in emerging markets can be quite different to that in the developed markets. Wuand Strange (2000), for example, point to the greater benefits of locating close to government links inChina and other emerging markets.

There is great scope for many studies at the level of the firm and its strategies with regard toevery aspect of its operations in today's world that involves doing business over geographical, insti-tutional, cultural distances. Some researchers argue that we are likely to see the emergence of theBeijing consensus to challenge the Washington consensus. New models of engagement of firms andgovernments are to be seen very clearly in the developing importance of the Chinese in Africa (seeinter alia; Brautigam, 2009; Halper, 2010; McKinnon, 2010). The reliance on free markets associatedwith North American mainstream thinking is giving way to the more sophisticated and pragmatic ap-proach whereby governments oversee or even own many of the large MNCs, and where trade policy,aid and FDI are intricately interlinked.

4.7. Attracting and benefiting from FDI

The received wisdom until recently was that most FDI would continue to flow between the developedcountries, and from the developed to the developing, emerging and transition countries. It is now recog-nised that this is not the full picture, because FDI now flows increasingly between the emerging countries,and from them to the developing and developed countries (see, inter alia, Buckley et al., 2011).Gammeltoft et al. (2010) study EM multinational FDI flows, and Verma and Brennan (2011) show thatthe investment development path theory applies incompletely to India's experience.


There is great scope for increasingly detailed examination at the level of the firm, industry and govern-ment policy of the causes and effects of FDI inflows and outflows from, to and within emerging marketcountries. In this vein, Barry and Kearney (2006) used portfolio theory on industry-level employmentdata to show how inward FDI has changed the industrial structure of the Irish economy in a way that al-lows it to achieve faster potential growth with less volatility than before. Although the industries that havebeen targeted are themselves more risky than the indigenous industries, together they form a superior in-dustrial portfolio. This effect is already having very positive effects in mitigating the effects of the acute re-cession, and it will also hasten recovery.

More recent related work includes Krammer (2010) who builds a panel dataset from 47 countries overthe period 1990 to 2006, half of which are developed Western European and the rest being from Centraland Eastern Europe and Central Asia, and using panel cointegration techniques, he disentangles thetrade and FDI effects on total factor productivity to show that imports are more influential than FDI in gen-erating positive spillovers. Kalafouros and Forsans (forthcoming) utilise a firm-level, panel dataset of over1000 observations on 109 Indian chemical firms over the 10 year period from 1997 to 2006. They showthat while sourcing knowledge from domestic organisations has negligible effects on these firms' financialperformance while adversely their own R&D, acquiring knowledge from foreign sources improves theirperformance along with their innovation potential. Kejzar (2011) uses an oligopolistic model to showhow the attraction of FDI by governments can enhance domestic welfare even when indigenous firms re-spond by moving offshore.

Reimann et al. (2012) use cross-industry data from 213 MNE subsidiaries in Asia, Eastern Europe, andLatin America to show how local mid-level employees both instigate and respond to the corporate socialefforts of their firms. Although governments do not influence the social strategies of the subsidiaries of for-eign MNEs, their support of MNEs can rise as a result of engagement with local communities. This kind ofwork, building on stakeholder theory and using firm-level survey techniques, is on the cusp of future re-search directions in emerging markets. Franco et al. (2011) employ factor analysis on a sample of morethan 1200 multinational affiliates in Brazil and India to study how they import technological innovationfrom their parent MNCs, and they show how national innovation systems are pivotal in shaping the prac-tices and abilities of the local affiliates. Finally, Hanousek et al. (2011) review the literature on how FDI im-pacts on economies during their transformation to market systems. Using the meta-analysis methodology,they show that studies on emerging European markets show that both the direct and indirect FDI effectsare weakening over time. They explain this on the basis of publication bias, more sophisticated researchtechniques, and more control variables. They also show that panel studies are likely to find weaker spill-over effects. Doubtless, this area of research is destined to be well covered in the near and medium term,because the answers to fundamental questions remain as illusive as they are important to policymakerswho seek the most effective ways to attract and harness the benefits of FDI.

4.8. Corporate and institutional governance

There are many benefits to be gained by international expansion and diversification including largermarkets to apply specialist knowledge and management capabilities; scale economies in production anddistribution; and rents from imperfectly competitive markets. But there are also many costs and risks as-sociated with international expansion including greater coordination and management expenses; greatercomplexity in enforcing contracts and protecting patents; and higher levels of uncertainty due to foreignexchange movements, taxation arrangements, and a host of political factors. Combining these benefits,costs, risks and uncertainties, it is not surprising that an extensive literature to date remains equivocalabout the extent to which internationalisation enhances firm value and benefits shareholders (see interalia; Berry, 2006; Berrill and Kearney, 2011). It is consequently important to consider corporate gover-nance within internationalising firms in both developed and emergingmarkets. Domanagers within inter-nationalising firms act in accordance with the interests of their shareholders when they expand anddiversify their activities across geographical, cultural and institutional distance? Alternatively, do interna-tionalising managers add to agency costs by acting principally in their own interests while anticipatinggreater managerial power within the governance structure of their firms? It is possible that the directionof causation runs the other way around. As firms become increasingly international in their operations,strategy and vision, does this strengthen or mitigate the relative power of managerial teams relative to


the rights of shareholders? Could internationalisation promote the power of managers while simulta-neously promoting shareholders' rights?

The literature here is sparse, particularly because of the paucity of appropriate firm-level data for corpo-rate governance and the degree of firm-level internationalisation. One related branch of the literature focuseson how corporate governance is reflected in firm equity valuation (Gompers et al., 2003). Another focuses oncorporate governance within multinational enterprises (Mascarenhas, 2009; Windsor, 2009). A third strandfocuses on the extent to which greater firm-level internationalisation impacts upon governance and the rel-ative power of managers relative to shareholders (Klapper and Love, 2004; Bebchuk et al., 2009; Berrill et al.,2011). Braun and Raddatz (2010) use a multi-country dataset linking in excess of 10,000 politicians (cabinetmembers, central bankers and financial regulators) and 60,000members of bank boards to examine how fre-quently former high-ranking politicians become bank directors. They find that although ‘politician-banker’connections at this level are few, their frequency is robustly correlated with important characteristics ofbanks — politically connected banks are bigger, less leveraged, less risky, and more profitable. The authorsfurther find that this correlation is more noticeable in countries with powerful but less accountablegovernments and weaker institutions. They conclude that ‘a benign, public-interest view is hard toreconcile with these patterns’.

This concern reaches to the heights of global governance. Kaja and Werker (2010) show that develop-ing countries with representatives serving on the board of the World Bank tend to obtain double the fund-ing from the International Bank for Reconstruction and Development (IBRD) relative to countries with nosuch representation. This average ‘bonus’ US$60 million in loans rises in years when the IBRD loans are inhigh demand, and it does so particularly for countries in the most influential seats on the board. Notingthat strong governance is commonly associated with good economic performance, and that higher in-comes are expected to enhance the quality of governance, Voors et al. (2011) employ a unique datasetusing corruption as their proxy for the quality of governance, and rainfall as an instrument for incomesin a panel of African countries. They find that positive income shocks can lead to better governance inlow-corruption countries, but tend to raise corruption in the most corrupt countries. Clausen et al.(2011) use the Gallup World Poll of households to demonstrate the existence of a large and significantnegative correlation between corruption and confidence in public institutions, which is shown to be ro-bust to an extensive set of controls for country and respondent-level characteristics. As with many similarstudies, correlation does not necessarily imply causation, and it is likely that both are co-determined. Thisprovides ample opportunity for further research on this important topic.

4.9. Behavioural perspectives, culture and the demise of the representative agent

Culture appears as an add-on within the JEL system, but features as category 10 in our EM version. Ad-vances in the measurement of culture (Hofstede, 2001; Inglehart, 1997; Schwartz and Sagiv, 1995) and theGlobe project (House et al., 2002) have spawned many applications and insights of relevance to decision-making. It is becoming increasingly recognised how disciplines such as anthropology, genetics, history, phi-losophy and psychology contribute to our understanding of the determinants of culture. National culture inturn influences the infrastructure upon which financial decision-making occurs — including the structure ofmarkets and institutions (Aggarwal and Goodell, 2009; Kirkman et al., 2006); accounting conventions andpractices (Nobes, 1992) and systems of corporate governance (Bushman et al., 2004). These factors lie behindmany of the features that distinguish emerging from developed markets, and it follows that cultural effectsare pivotal to understanding many issues related to emerging markets. This is an emerging topic (see interalia, Aviat and Coeurdacier, 2007 on goods and asset trade, Huang, 2007 on goods trade, Lucey and Zhang,2010 on equity market correlations, and Aggarwal, et al., 2012 on foreign portfolio investment).

Some groups of emerging market countries cluster along cultural dimensions that are commensuratewith their geographic locations. Dunning et al. (2007) divided the world into six regions using the culturalclassification originally proposed by Ronen and Shenkar (1985): Anglo, Latin European, Nordic and Ger-manic, Latin American, Far Eastern, and Other. The emerging countries fall mostly into the followinggroups: Far Eastern with 9 countries (China, India, Indonesia, Malaysia, Pakistan, Philippines, SouthKorea, Taiwan and Thailand); Latin American with 7 countries (Argentina, Brazil, Chile, Columbia, Mexico,Peru and Venezuela); Anglo with 1 country (South Africa); and Other with 10 countries that fall


conspicuously into two groups comprising East European (Czech Republic, Hungary, Poland and Russia)and MENA (Egypt, Israel, Jordan, Turkey and the United Arab Emirates).

Table 4 provides the measures of these cultural dimensions in emerging market countries. The differ-ences are stark. Columbia, Pakistan, Peru and Venezuela are amongst the most collectivist countries (i.e.they score lowest on individualism), while Hungary, Poland and South Africa are highly individualist. Hun-gary and Venezuela score highly in their degree of masculinity, while Chile and Thailand are the oppositeend of this measure. Malaysia and Russia are the most power distant emerging countries, while Israel isthe least. India and the Philippines are most comfortable with uncertainty and ambiguity, while Polandand Russia are the most uncertainty-avoiding emerging markets.

Jung et al. (2009) show how, due to greater uncertainty and less transparency in emerging markets, in-vestor heterogeneity – defined as differences in the information set available to representative investorsfrom developed markets as opposed to representative investors from emerging markets – can help explainthe cross-section of average stock returns in emerging markets. They show that a heterogeneity-augmented two-factor model outperforms the capital asset pricing model (CAPM) one-factor and theFama–French three-factor models in Korea to a greater extent than in Japan.

But there is a more far-reaching meaning that we should convey to heterogeneity. In the theoreticalworld of mainstream economics and finance, fully-informed, rational, representative agents with identicalbeliefs and preferences optimally respond to asymmetric information, agency costs and moral hazard byseeking contracts that align the interests of all contracting parties. Because contracts are incomplete dueto the impossibility of specifying all contingencies, however, market participants frequently have to relyon customary practices, social mores and ethics. This arises in developed markets, and it arises to a greaterextent in emerging markets — which are partly defined by their weaker institutions of legal and propertyrights. The responses of people come under the umbrella of culture. In the world of behavioural interna-tional economics and finance, cultural traits such as assertiveness, competitiveness, decisiveness,

Table 4Hofstede's cultural dimensions for emerging markets.

Individualism Masculinity Power distance Uncertainty avoidance

CountriesArgentina 46 56 49 86Brazil 38 49 69 76Chile 23 28 63 86China 20 66 80 30Czech Republic 57 57 57 74Colombia 13 64 67 80Egypt* 38 52 80 68Hungary 80 88 46 82India 48 56 77 40Indonesia 14 46 78 48Israel 54 47 13 81Jordan* 38 52 80 68Malaysia 26 50 104 36Mexico 30 69 81 82Morocco 46 53 70 68Pakistan 14 50 55 70Peru 16 42 64 87Philippines 32 64 94 44Poland 60 64 68 93Russia 39 36 93 95South Africa 65 63 49 49South Korea 18 39 60 85Taiwan 17 45 58 69Thailand 20 34 64 64Turkey 37 45 66 85United Arab Emirates* 38 52 80 68Venezuela 12 73 81 76

Notes. See www.geert-hofstede.com for more details on the country scores. Egypt, Jordan and the UAE have similar scores becauseEgypt and Jordan are surveyed as ‘Arab countries’. A fifth dimension, ‘long term orientation’ is available for some countries.

http://www.geert-hofstede.com


emotional expression, family cohesiveness, tolerance of inequality, group loyalty, inclusiveness, respect fortradition and social responsibility can be important determinants of decision-making alongside the long-recognised orientations with respect to return, risk and time.

These dimensions of culture shape the core belief systems and values of heterogeneous agents from diver-gent cultures in ways that cannot be encompassed within the representative agent framework, and point in-stead to business decision-making commensurate with the mental frames, judgemental heuristics andbounded rationality of Tversky and Kahneman (1974), Thaler (1993), Shefrin (2001) and de Bondt et al.(2010). Studying many aspects of EM research in this way recognises how cultural differences lead to inter-nationally heterogeneous agents in the same way as divergent beliefs and preferences define heterogeneousinvestors in the recentwithin-country asset pricing and portfolio theory of Hansen (2007), Bhamra andUppal(2010) and Stiglitz (2010). It can also guide and inform business managers, investors and regulators abouthow the interplay of divergent cultural traits drives observed behavioural patterns at the level of the individ-ual, the firm, the industry and the country. Although theoretical derivations will be more complex, the ben-efits will include a much broader and deeper set of hypotheses to test on increasingly diverse data sets inEM research.

5. Summary and concluding comments

EM research is increasingly recognised as a dynamic, multidisciplinary inquiry that borrows theory andtesting methodologies from not only the main business disciplines of economics, finance, internationalbusiness andmanagement, but also from disciplines as disparate as anthropology, genetics, geography, his-tory, law, philosophy, political science, psychology, physics and sociology. The research agendas are manyand varied across an extensive array of important issues that directly address humanwelfare in the world'spoorest countries as well as in the developing world, the transition countries and the developedworld. Thequestions posed and the insights obtained are important, relevant and valuable beyond question.

Using a version of the JEL classification system to examine the main topics in EM research, we haveseen that the scope is extensive, encompassing a great many themes. Combining this with a listing ofthe academic journals in which the most influential contributions have been disseminated, we haveseen that in addition to Emerging Markets Review, other leading journals explicitly mention emerging mar-kets in their editorial statements, and many more also publish work on EM research. We reviewed the lat-est work and pointed to the newest areas of promising research. In doing so, we focussed on nine topics:Data and methods; market efficiency, risk-adjusted returns and risk premia; exchange rate volatility andfirm-level exposures; classification systems, clusters and networks; firm-level internationalisation; inter-national business strategy; attracting and benefiting from FDI; corporate and institutional governance;and behavioural perspectives, culture and the demise of the representative agent.

In conclusion, it seems beyond doubt that EM research is set to grow in influence and reach, not justbecause of the rich insights that are being gained about how these countries develop and prosper overtime, but also because of the growing awareness of how this research agenda can contribute to our under-standing of many areas of economics, finance and international business in all countries of the world.

References

Aggarwal, R., Goodell, J.W., 2009. Markets versus institutions in developing countries: national attributes as determinants. EmergingMarkets Review 10 (1), 51–66.

Aggarwal, R., Dahiya, S.D., Klapper, L., 2007. ADR holdings of US-based emerging market funds. Journal of Banking and Finance 31 (6),1649–1667.

Aggarwal, R., Berrill, J., Hutson, E., Kearney, C., 2011. What is a multinational corporation? Classifying the degree of firm-level multi-nationality. International Business Review 20 (5), 557–577.

Aggarwal, R., Kearney, C., Lucey, B., 2012. Gravity and culture in foreign portfolio investment. Journal of Banking and Finance 36 (2),525–538.

Aharoni, Y., 2006. Book review: Alan M Rugman, The regional multinationals: MNEs and global strategic management. InternationalBusiness Review 15 (4), 439–446.

Ahmad, K., Kearney, C., Liu, S., 2011. Textual Sentiment Analysis in Finance: A Survey of Methods and Models. Research Paper,December.

Aidis, R., Welter, F. (Eds.), 2008. Innovation and Entrepreneurship: Successful Start-ups and Businesses in Emerging Economies.Elgar, Cheltenham, U.K. and Northampton, Mass.


Al-Hassan, A., Delgado, F., Omran, M., 2010. The under-pricing of IPOs in the Gulf cooperation council countries. Research in Interna-tional Business and Finance 24 (3), 344–360.

Al-Khazali, O.M., Ding, D.K., Pyun, C.S., 2007. A new variance ratio test of randomwalk in emergingmarkets: a revisit. Financial Review 42(2), 303–317.

Al-Sakka, R., Gwilym, O., 2012. Split sovereign ratings and rating migrations in emerging economies. Emerging Markets Review 11(2), 79–97.

Ángel Canela, M., Pedreira Collazo, E., 2007. Portfolio selection with skewness in emerging market industries. Emerging Markets Review8 (3), 230–250.

Angelidis, T., 2010. Idiosyncratic risk in emerging markets. The Financial Review 45 (4), 1053–1078.Antweiler, W., Frank, M.Z., 2004. Is all that talk just noise? The information content of internet stock message boards. Journal of Finance

59, 1259–1294.Asmussen, C.G., 2009. Local, regional or global? Quantifying MNE geographic scope. Journal of International Business Studies 407,

1192–1205.Aviat, A., Coeurdacier, N., 2007. The geography of trade in goods and asset holdings. Journal of International Economics 71, 22–51.Aysun, U., Guldi, M., 2012. Exchange rate exposure: a nonparametric approach. Emerging Markets Review 12 (4), 321–337.Barry, F., Kearney, C., 2006. MNEs and industrial structure in host countries: a portfolio analysis of Irish manufacturing. Journal of

International Business Studies 37/3, 392–406.Bartlett, C., Ghoshal, S., 1989. Managing Across Borders: The Transnational Solution. Harvard Business School Press, Boston.Batten, J.A., Kearney, C. (Eds.), 2006. Emerging European Financial Markets: Independence and Integration Post-Enlargement.

International Finance Review, vol. 6. Elsevier.Bebchuk, L., Cohen, A., Ferrell, A., 2009. What matters in corporate governance? Review of Financial Studies 22 (2), 783–827.Beck, T., Brown, M., 2011. Which households use banks? Evidence from the Transition Economies. European Central Bank Working

Paper Series 1295.Beirne, J., Caporale, G.M., Schulze-Ghattas, M., Spagnolo, N., 2012. Global and regional spillovers in emerging stock markets: a mul-

tivariate GARCH-in-mean analysis. Emerging Markets Review 11 (3), 250–260.Bekaert, G., Harvey, C., 1997. Emerging equity market volatility. Journal of Financial Economics 43, 29–77.Bekaert, G., Harvey, C.R., 2003. Emerging markets finance. Journal of Empirical Finance 10 (1), 3–55.Berrill, J., Kearney, C., 2011. Investing in emerging and developing markets. In: Kent Baker, H., Riddick, Leigh A. (Eds.), Survey of

International Finance. Oxford University Press.Berrill, J., Kearney, C., Sevic, A., 2011. Corporate governance, internationalisation and the division of power between managers and

shareholders. Research paper, Business School, Trinity College Dublin, August.Berry, H., 2006. Shareholder valuation of foreign investment and expansion. Strategic Management Journal 27, 1123–1140.Bhamra, H.S., Uppal, R., 2010. Asset Prices with Heterogeniety In Preferences and Beliefs. Research paper, November.Bhattacharya, U., Daouk, H., Jorgenson, B., Kehr, C.-H., 2000. When an event is not an event: the curious case of an emerging market.

Journal of Financial Economics 55 (1), 69–101.Blanchard, O.J., Das, M., Faruqee, H., 2010. The initial impact of the crisis on emerging market countries. Brookings Papers on Economic

Activity, pp. 263–323. Spring.Bleakley, H., Cowan, K., 2010. Maturity mismatch and financial crises: evidence from emerging market corporations. Journal of

Development Economics 93 (2), 189–205.Bleaney, M., Castilleja Vargas, L., 2009. Real exchange rates, valuation effects and growth in emerging markets. Open Economies

Review 20 (5), 631–643.Braun, M., Raddatz, C., 2010. Banking on politics: when former high-ranking politicians become bank directors. World Bank Economic

Review 24 (2), 234–279.Brautigam, D., 2009. The Dragon's Gift: The Real Story of China in Africa. Oxford University Press, Oxford.Bruton, G.D., Khavul, S., Chavez, H., 2011. Microlending in emerging economies: building a new line of inquiry from the ground up.

Journal of International Business Studies 42 (5), 718–739.Buckley, P.J., Stefano, E., Kafouros, M., 2011. FDI from emerging to advanced countries: some insights on the acquisition strategies

and on the performance of target firms. Economia e Politica Industriale 38 (1), 181–197.Bunda, I., Javier Hamann, A., Lall, S., 2009. Correlations in emerging market bonds: the role of local and global factors. Emerging

Markets Review 10 (2), 67–96.Bushman, R.M., Piotroski, J.D., Smith, A.J., 2004. What determines corporate transparency? Journal of Accounting Research 42,

207–252.Capital Controls and Capital Flows in Emerging Economies: Policies, Practices, and Consequences. In: Edwards, S. (Ed.), National

Bureau of Economic Research. University of Chicago Press, Chicago and London.Clausen, B., Kray, A., Nyiril, Z., 2011. Corruption and confidence in public institutions: evidence from a global survey. World Bank

Economic Review 25 (2), 212–249.Cole, S., Sampson, T., Zia, B., 2011. Prices or knowledge? What drives demand for financial services in emerging markets? Journal of

Finance 66 (6), 1933–1967.Coricelli, F., Maurel, M., 2011. Growth and crisis in transition: a comparative perspective. Review of International Economics 19 (1),

49–64.Cunado, J., Gomez Biscarri, J., Perez De Gracia, F., 2006. Changes in the dynamic behavior of emerging market volatility: revisiting the

effects of financial liberalization. Emerging Markets Review 7 (3), 261–278.Das, S.R., Chen, M.Y., 2007. Yahoo! for Amazon: sentiment extraction from small talk on the web. Management Science 53,

1375–1388.de Bondt, W., Forbes, W., Hamalainen, P., Muradoglu, Y.G., 2010. What can behavioural finance teach us about finance? Qualitative

Research in Financial markets 2, 29–36.Demir, F., Dahi, O.S., 2011. Asymmetric effects of financial development on south-south and south–north trade: panel data evidence

from emerging markets. Journal of Development Economics 94 (1), 139–149.Demirbag, M., Tatoglu, E., 2009. Market entry and operational strategies of MNEs in transition and emerging economies. Journal of

East–west Business 15 (3–4), 157–163.


Dethier, J.-J., Hirn, M., Straub, S., 2011. Explaining enterprise performance in developing countries with survey data. The World BankResearch Observer 26 (2), 258–309.

Dolfsma, W., Duysters, G., Costa, I. (Eds.), 2009. Multinationals and Emerging Economies: The Quest for Innovation and Sustainability.Elgar, Cheltenham, U.K. and Northampton, Mass.

Donadelli, M., Prosperi, L., 2011. The Equity Risk Premium: Empirical Evidence from Emerging Markets. Research Paper, May. SSRN.http://ssrn.com/abstract=1893378.

The Political Economy of Trade Reform in Emerging Markets: Crisis or Opportunity? In: Draper, P., Alves, P., Sally, R. (Eds.), Elgar,Cheltenham, U.K. and Northampton, Mass.

Dunning, J., 1993. Multinational Enterprises and the Global Economy. Addison-Wesley, London.Dunning, J.H., Lin, T.-M. (Eds.), 2007. Multinational Enterprises and Emerging Challenges of the 21st Century. Elgar, Cheltenham, U.K.

and Northampton, Mass.Dunning, J., Fujita, M., Yakova, N., 2007. Some macro-data on the regionalisation/globalisation debate: a comment on the Rugman/

Verbeke analysis. Journal of International Business Studies 381, 177–199.Durdu, C.B., Sayan, S., 2010. Emerging market business cycles with remittance fluctuations. IMF Staff Papers 57 (2), 303–325.Ebecka, C., Ehrhartb, H., 2012. Tax revenue instability in sub-Saharan Africa: Consequences and remedies. Journal of African

Economics 21 (1), 1–27.Earl, M., 2001. Knowledge management strategies: towards a taxonomy. Journal of Management Information Systems 18 (1),

215–233.Financial Markets Volatility and Performance in Emerging Markets. In: Edwards, S., Garcia, M.G.P. (Eds.), National Bureau of Economic

Research. University of Chicago Press, Chicago and London.Elbadawe, I., Mengistar, T., Zeufack, A., 2006. Market access, supplier access, and Africas manufactured exports: a firm level analysis.

The Journal of International Trade & Economic Development 15 (4), 493–523.Espinoza, R., Prasad, A., Williams, O., 2011. Regional financial integration in the GCC. Emerging Markets Review 12 (4), 354–370.Fagiolo, G., Reyes, J., Schiavo, S., 2010. The evolution of the world trade web: a weighted-network analysis. Journal of Evolutionary

Economics 20 (4), 479–514.Fan, J.O.H., Wei, K.C.J., Xu, X., 2011. Corporate finance and governance in emerging markets: a selective review and an agenda for future

research. Journal of Corporate Finance 17 (2), 207–214.Faria, A., Paolo, M., Zaklan, A., 2011. The external financing of emerging markets — evidence from two waves of financial globalization.

Review of Finance 15 (1), 207–243.Fayyad, A., Daly, K., 2011. The impact of oil price shocks on stock market returns: comparing GCC countries with the UK and USA.

Emerging Markets Review 12 (1), 61–78.Fifield, S.G.M., Lonie, A.A., Power, D.M., Sinclair, C.D., 1999. Emerging markets: a disaggregated perspective on the gains from investing

internationally diversified firms. Review of Pacific Basin Financial Markets and Policies 2 (1), 99–124.Flavin, T., O'Connor, T., 2010. The sequencing of stock market liberalization events and corporate financing decisions. Emerging Markets

Review 11 (3), 183–204.Franco, E., Ray, S., Ray, P.K., 2011. Patterns of innovation practices of multinational-affiliates in emerging economies: evidences from

Brazil and India. World Development 39 (7), 1249–1260.Gammeltoft, P., Pradhan, J.P., Goldstein, A., 2010. Emerging multinationals: home and host country determinants and outcomes.

International Journal of Emerging Markets 5 (3/4), 254–265.Gompers, P., Ishii, J., Metrick, A., 2003. Corporate governance and equity prices. Quarterly Journal of Economics 118 (1), 107–156.Goyal, A., 2011. Sustainable debt and deficits in emerging markets. International Journal of Trade and Global Markets 4 (2), 113–136.Guglielmo, M.C., Amor, T.H., Rault, C., 2011. International financial integration and real exchange rate long-run dynamics in emerging

countries: Some panel evidence. Journal of International Trade and Economic Development 20 (6), 789–808.Günther, J., Jindra, B., Stephan, J., 2009. Does local technology matter for foreign investors in Central and Eastern Europe? Evidence

from the IWH FDI micro database. Journal of East–west Business 15 (3–4), 210–247.Gupta, A.K., Wang, H., 2009. Getting China and India Right. Josey-Bass Wiley.Halper, S., 2010. The Beijing Consensus: HowChina's AuthoritarianModelwill Dominate the Twenty First Century. Basic Books, NewYork.Hammond, G., Kanbur, R., Prasad, E. (Eds.), 2009. Monetary Policy Frameworks for Emerging Markets. Elgar, Cheltenham, U.K. and

Northampton, Mass.Hanousek, J., Kočenda, E., Maurel, M., 2011. Direct and indirect effects of FDI in emerging European markets: A survey and meta-

analysis. Economic Systems 35 (3), 301–322.Hansanti, S., Islam, S.M.N., Sheehan, P., 2008. International Finance in Emerging Markets: Issues, Welfare Economics Analyses and

Policy Implications. Contributions to Economics. Springer, Physica-Verlag, Heidelberg.Hansen, L.P., 2007. Beliefs, doubts and learning. The American Economic Review 97, 1–30.Harb, George, 2010. Communication infrastructures, institutional efficiency and EU–Arab trade: assessment and implications.

Review of Middle East Economics and Finance: 6 (2), 1270–1280.Hearn, B., 2011. The impact of corporate governancemeasures on the performance ofWest African IPO firms. EmergingMarkets Review

12 (2), 130–151.Hofstede, G., 2001. Cultures Consequences: Comparing Values, Behaviors, Institutions and Organizations across Nations. Sage, Thousand

Oaks.Hoque, H.A., Kim, J.H., Pyun, C.S., 2007. A comparison of variance ratio tests of random walk: a case of Asian emerging stock markets.

International Review of Economics and Finance 16 (4), 488–502.Hossain, M., Lim, C.Y., Tan, P.M.S., 2010. Corporate governance, legal environment, and auditor choice in emerging markets. Review

of Pacific Basin Financial Markets and Policies 13 (1), 91–126.House, R., Javidan, M., Hanges, P., Dorfman, P., 2002. Understanding cultures and implicit leadership theories across the globe: an

introduction to project GLOBE. Journal of World Business 37, 3–10.Huang, R.R., 2007. Distance and trade: disentangling unfamiliarity effects and transport cost effects. European Economic Review 51,

161–181.Huang, J., Zhi, H., Huang, Z., Rozelle, S., Giles, J., 2011. The impact of the global financial crisis on off-farm employment and earnings in

rural China. World Development 39 (5), 797–807.

http://ssrn.com/abstract=1893378


Hutson, E., Stevenson, S., 2010. Openness, hedging incentives and exchange exposure: a firm-level multi-country study. Journal ofInternational Business Studies 41 (1), 105–122.

Hutson, E., Sinkovics, R.R., Berrill, J., 2011. Firm-level Internationalisation, Regionalism and Globalisation. Basingstoke, PalgraveMacmillan.

Inglehart, R., 1997. Modernisation and Post-modernisation: Cultural, Economic and Political Change in 43 Societies. PrincetonUniversity Press, Princeton, NJ.

Ismailescu, I., Kazemi, H., 2010. The reaction of emerging market credit default swap spreads to sovereign credit rating changes. Journalof Banking and Finance 34 (12), 2861–2873.

Jahan-Parvar, M.R., Waters, G.A., 2012. Equity price bubbles in the Middle Eastern and North African financial markets. EmergingMarkets Review 11 (1), 39–48.

Jain, S.C. (Ed.), 2006. Emerging economies and the transformation of international business: Brazil, Russia, India and China (BRICs).New Horizons in International Business. Elgar, Cheltenham, U.K. and Northampton, Mass.

Jansson, H., 2007. International Business Strategy in Emerging CountryMarkets: The Institutional Network Approach. Elgar, Cheltenham,U.K. and Northampton, Mass.

Jung, C.S., Lee, D.W., Park, K.S., 2009. Can investor heterogeneity be used to explain the cross-section of average stock returns inemerging markets? Journal of International Money and Finance 28 (4), 648–670.

Kalafouros, M., Forsans, N., forthcoming. The role of open innovation in emerging economies: Do companies profit from the scientificknowledge of others? Journal of World Business.

Kaja, A., Werker, E., 2010. Corporate governance at the World Bank and the dilemma of global governance. World Bank EconomicReview 24 (2), 171–198.

Kejzar, K.Z., 2011. Investment liberalisation and firm selection process: a welfare analysis from a host-country perspective. Journal ofInternational Trade and Economic Development 20 (3), 357–377.

Kenourgios, D., Samitas, A., 2011. Equity market integration in emerging Balkan markets. Research in International Business andFinance 25 (3), 296–307.

Khilji, F., 2003. Financial crises in emerging markets: review. Journal of Economic Studies 30 (2), 169–182.Kirkman, B.L., Lowe, K.B., Gibson, C.B., 2006. A quarter century of cultures consequences: a review of empirical research incorporating

Hofstedes cultural values framework. Journal of International Business Studies 37, 285–320.Kiymaz, H., Alon, I., Veit, T., 2009. Examining the returns of American depository receipts: evidence from emerging and developed

markets. Thunderbird International Business Review 51 (6), 567–581.Klapper, L., Love, I., 2004. Corporate governance, investor protection, and performance in emerging markets. Journal of Corporate

Finance 10 (5), 703–728.Kling, G., Weitzel, U., 2011. The internationalization of Chinese companies: firm characteristics, industry effects and corporate

governance. Research in International Business and Finance 25 (3), 357–372.Kohli, H.S., 2008. Growth and Development in Emerging Market Economies: International Private Capital Flows, Financial Markets

and Globalization. Sage Publications, Los Angeles and London.Kortas, M., LHer, J.-F., Roberge, M., 2005. Country selection of emerging equity markets: benefits from country attribute diversification.

Emerging Markets Review 6 (1), 1–19.Koveshnikov, A., forthcoming. A framework of successful organizational practices in Western multinational companies operating in

Russia. Journal of World Business.Kraeussl, Logher, R., 2012. Emerging art markets. Emerging Markets Review 11 (4), 301–318.Krammer, S.M.S., 2010. International R&D spillovers in emerging markets: the impact of trade and foreign direct investment. Journal

of International Trade and Economic Development 19 (4), 591–623.Kuchiki, A., Tsuji, M. (Eds.), 2010. From Agglomeration to Innovation: Upgrading Industrial Clusters in Emerging Economies. New

York: St. Martin's Press, Palgrave Macmillan.Kumar, N., 2008. Internationalization of Indian enterprises: patterns, strategies, ownership advantages, and implications. Asian

Economic Policy Review 3 (2), 242–261.Kvint, V., 2009. The Global Emerging Market: Strategic Management and Economics. Taylor and Francis, Routledge, New York and

London.Lagoarde-Segot, T., Lucey, B., 2007. International portfolio diversification: is there a role for the Middle East and North Africa? Journal

of Multinational Financial Management 17 (5), 401–416.Lagoarde-Segot, T., Lucey, B., 2008. Efficiency in emerging markets — evidence from the MENA region. Journal of International Financial

Markets, Institutions and Money 18 (1), 94–105.Law, K.S., Wong, C.-S., Mobeley, W.H., 1998. Toward a taxonomy of multidimensional constructs. The Academy of Management

Review 23 (4), 741–755.Lee, H., Lee, C.-Y. (Eds.), 2007. Building Supply Chain Excellence in Emerging Economies. International Series in Operations Research

and Management Science. Springer, New York.Li, X.-M., Rose, L., 2009. The tail risk of emerging stock markets. Emerging Markets Review 10 (4), 242–256.Li, K., Sarker, A., Wang, Z., 2003. Diversification benefits of emerging markets subject to portfolio constraints. Journal of Empirical

Finance 10 (1–2), 59–82.Lien, D., Zhang, M., 2008. A survey of emerging derivatives markets. Emerging Markets Finance and Trade 44 (2), 39–69.Liu, Y., Li, Y., Xue, J., 2011. Ownership, strategic orientation and internationalization in emerging markets. Journal of World Business

46 (3), 381–393.Loughran, T., McDonald, B., 2011. When is a liability not a liability? Textual analysis, dictionaries, and 10-Ks. Journal of Finance 66,

35–65.Love, I., 2011. Corporate governance and performance around the world: what we know and what we don't. World Bank Research

Observer 261, 42–70.Lucey, B.M., Zhang, Q., 2010. Does cultural distance matter in international stock market comovement? Evidence from emerging

economies around the world. Emerging Markets Review 11, 62–78.Manning, S., 2008. Customizing clusters: on the role of Western multinational corporations in the formation of science and engineering

clusters in emerging economies. Economic Development Quarterly 22 (4), 316–323.


Marchand, M.H., Boas, M., Shaw, T.M., 1999. New regionalisms in the new millennium. Third World Quarterly 20 (5), 897–910.Mascarenhas, B., 2009. The emerging CEO agenda. Journal of International Management 15, 245–250.Matthews, J.A., 2009. China, India and Brazil: tiger technologies, dragon multinationals and the building of national systems of

economic learning. Asian Business and Management 8 (1), 5–32.Mauro, P., Sussman, N., Yafeh, Y., 2006. Emerging Markets and Financial Globalization: Sovereign Bond Spreads in 1870–1913 and

Today. Oxford University Press, Oxford and New York.McGee, J., Thomas, H., 1986. Strategic groups: theory, research and taxonomy. Strategic Management Journal 7 (2), 141–160.McKinnon, R.I., 2010. China in Africa: the Washington consensus versus the Beijing consensus. International Finance 13, 495–506.Mihaljek, D., Packer, F., 2010. Derivatives in emerging markets. BIS Quarterly Review December, pp. 43–58.Miller, J.G., Roth, A.V., 1994. A taxonomy of manufacturing strategies. Management Science 40 (3), 285–304.Miller, S.R., Thomas, D.E., Eden, L., Hitt, L., 2008. Knee deep in the big muddy: the survival of emerging market firms in developed

markets. Management International Review 48 (6), 645–666.Moschella, M., 2010. Mexico and the IMF in the 1990s: old and new issues on capital account liberalization and emerging market

countries. Comparative Economic Studies 52 (4), 589–609.Moshirian, F., Ng, D., Wu, E., 2010. Model specification and IPO performance: new insights from Asia. Research in International Business

and Finance 24 (1), 62–74.Naranjo, A., Porter, B., 2007. Including emerging markets in international momentum investment strategies. Emerging Markets

Review 8 (2), 147–166.Nitin, P., Wu, J., forthcoming. Industry globalization and the performance of emerging market firms: Evidence from China. International

Business Review.Nobes, C.W., 1992. International Classification of Financial Reporting. Routledge, UK.Ohmae, K., 1985. Triad Power: The Coming Shape of Global Competition. The Free Press, New York.Olson, D., Zoubi, T.A., 2011. Efficiency and bank profitability in MENA countries. Emerging Markets Review 12 (2), 94–110.Osegowitsch, T., Sammartino, A., 2007. Exploring trends in regionalisation. In: Rugman, A.M. (Ed.), Research in global strategic

management, Vol. 13, Regional Aspects of multinationality and performance, Amsterdam, Elsevier.Osegowitsch, T., Sammartino, A., 2008. Reassessing home-regionalisation. Journal of International Business Studies 392, 184–196.Multinational Corporations and the Emerging Network Economy in Asia and the Pacific. In: Palacios, J.J. (Ed.), Pacific Trade and

Development Conference Series. Taylor and Francis, Routledge, London and New York.Patel, S., Balic, A., Bwakira, L., 2002. Measuring transparency and disclosure at firm-level in emerging markets. Emerging Markets

Review 3 (4), 325–337.Pelle, S., 2007. Understanding emerging markets: building business BRIC by brick. Response Books series. Sage Publications, London

and Thousand Oaks, California.Peng, M.W., Wang, D.Y.L., Jiang, Y., 2008. An institution-based view of international business strategy: a focus on emerging economies.

Journal of International Business Studies 39, 920–936.Perlmutter, H., 1969. The tortuous evolution of the multinational corporation. The Columbia Journal of World Business 4 (1), 9–18.Phylaktis, K., 2006. Emerging markets finance: overview of the special issue. Journal of International Money and Finance 25 (3),

349–357.Pinegar, M., Ravichandran, R., 2010a. Market timing wealth effects of American depository receipts: the cases of emerging and

developed market issues. Journal of International Financial Markets, Institutions and Money 16 (3), 270–282.Pinegar, M., Ravichandran, R., 2010b. Raising capital in emerging markets with restricted global depositary receipts. Journal of

Corporate Finance 16 (5), 622–636.Ramamurti, R., Singh, J.V. (Eds.), 2009. Emerging Multinationals in Emerging Markets. Cambridge University Press, Cambridge and

New York.Reimann, F., Ehrgott, M., Kaufmann, L., Carter, C.R., 2012. Local stakeholders and local legitimacy: MNEs social strategies in emerging

economies. Journal of International Management 18 (1), 1–17.Reyes, J., Schiavo, S., Fagiolo, G., 2010. Using complex networks analysis to assess the evolution of international economic integration:

the cases of East Asia and Latin America. The Journal of International Trade & Economic Development 19 (2), 215–239.Rich, P., 1992. The organizational taxonomy: definition and design. Academy of Management Review 17 (4), 758–781.Rocha, K., Moreira, A., 2012. The role of domestic fundamentals on the economic vulnerability of emerging markets. Emerging Markets

Review 11 (2), 173–182.Ronen, S., Shenkar, O., 1985. Clustering countries on attitudinal dimensions: a review and synthesis. Academy of Management

Review 10, 435–454.Rozelle, S., Huang, J., Zhang, L., 2002. Emerging markets, evolving institutions, and the new opportunities for growth in Chinas rural

economy. China Economic Review 13 (4), 345–353.Rugman, A., 2003. Regional strategy and the demise of globalisation. Journal of International Management 9 (4), 409–417.Rugman, A.M., 2010. Reconciling internationalisation theory and the eclectic paradigm. Multinational Business Review 18 (2), 1–12.Rugman, A., Verbeke, A., 2004. A perspective on regional and global strategies of multinational enterprises. Journal of International

Business Studies 35 (1), 3–18.Santangelo, G.D., Meyer, K.E., 2011. Extending the internationalization process model: Increases and decreases of MNE commitment

in emerging economies. Journal of International Business Studies 42 (7), 894–909.Sauvant, K.P., McAllister, G., Maschek, W.A. (Eds.), 2010. Foreign Direct Investments from Emerging Markets: The Challenges Ahead.

New York: St. Martin's Press, Palgrave Macmillan.Schwartz, S.H., Sagiv, L., 1995. Identifying culture-specifics in the content and structure of values. Journal of Cross-Cultural Psychology

26, 92–116.Scott, A.J., 2006. The changing global geography of low-technology, labor-intensive industry: clothing, footwear, and furniture.

World Development 34 (9), 1517–1536.Scott, A.J., Garofoli, G. (Eds.), 2007. Development on the Ground: Clusters. Taylor and Francis, Routledge, London and New York.Sharma, P., 2011. Country of origin effects in developed and emerging markets: exploring the contrasting roles of materialism and

value consciousness. Journal of International Business Studies 42 (2), 285–306.Shefrin, H., 2001. Behavioural Finance: A Three-Volume Edited Collection. Edward Elgar, London.


Siegel, J., 2005. Can foreign firms bond themselves effectively by renting US securities laws? Journal of Financial Economics 75 (2),319–359.

Singh, S. (Ed.), 2010. Handbook of Business Practices and Growth in Emerging Markets. World Scientific, Hackensack, N.J. andSingapore.

Stiglitz, J.E., 2010. An agenda for reforming economic theory. Slides presented to Institute for New Economic Thinking INET confer-ence, 22 May, Cambridge.

Taguchi, H., 2011. Monetary autonomy in emerging market economies: the role of foreign reserves. Emerging Markets Review 12 (4),371–388.

Tetlock, P.C., 2007. Giving content to investor sentiment: the role of media in the stock market. Journal of Finance 62, 1139–1168.Tetlock, P.C., Saar-Tsechansky, M., Macskassy, S., 2008. More than words: quantifying language to measure firms fundamentals.

Journal of Finance 63, 1437–1467.Thaler, R., 1993. Advances in Behavioural Finance. Russel Sage Foundation, New York.Thomson Reuters, 2011. Journal citation reports. http://go.thomsonreuters.com/jcr/.Turgutlu, E., Ucer, B., 2010. Is global diversification rational? Evidence from emerging equitymarkets throughmixed copula approach.

Applied Economics 42 (4–6), 647–658.Tversky, A., Kahneman, D., 1974. Judgement and uncertainty: heuristics and biases. Science 185, 1124–1131.Udomkerdmongkol, M., Morrissey, O., Görg, H., 2009. Exchange rates and outward foreign direct investment: US FDI in emerging

economies. Review of Development Economics 13, 754–764.van der Hart, J., Slagter, E., van Dijk, D., 2003. Stock selection strategies in emerging markets. Journal of Empirical Finance 10 (1–2),

105–132.Verma, R., Brennan, L., 2011. The investment development path theory: evidence from India. International Journal of Emerging

Markets 6 (1), 74–89.Voors, M.J., Bulte, E.H., Damania, R., 2011. Income shocks and corruption in Africa: does a virtuous cycle exist? Journal of African

Economies 20 (3), 395–418.Walid, C., Chaker, A., Masood, O., Fry, J., 2011. Stock market volatility and exchange rates in emerging countries: a Markov-state

switching approach. Emerging Markets Review 12 (3), 272–292.Windsor, D., 2009. Tightening corporate governance. Journal of International Management 15, 306–315.Wright, M., Filatotchev, I., Hoskisson, R.E.E., Peng,M.W., 2005. Strategy research in emerging economies: challenging the conventional

wisdom. Journal of Management Studies 42 (1), 1–33.Wu, X., Strange, R., 2000. The location of foreign insurance companies in China. International Business Review 9, 383–398.Yago, G., Barth, J.R., Zeidman, B. (Eds.), 2008. Entrepreneurship in Emerging Domestic Markets: Barriers and Innovation. Milken

Institute Series on Financial Innovation and Economic Growth. Springer, New York.Ye, M., Hutson, E., 2011. Managed exchange rates, dual listing, and foreign exchange exposure: the experience of Chinese banks

around the financial crisis. Journal of the Asia Pacific Economy 16 (3), 393–421.

http://go.thomsonreuters.com/jcr/

Documents

Emerging markets research: Trends, issues and future directions