Research on the import activities of firms 1960-2010: review, assessment, and future directions.

VerfasserAykol, Bilge
PostenRESEARCH ARTICLE - Report

Abstract:

* The article presents the findings of a comprehensive review of 321 import-related articles published in business journals and books during the period 1960-2010.

* Using a content analysis, the articles were assessed on four dimensions referring to the research design, scope of research, research methodology, and key thematic areas addressed.

* The assessment revealed that this body of research has advanced over time from an exploratory and descriptive phase into one that is characterized by greater maturity and sophistication.

* Based on input extracted from the articles reviewed, as well as from a survey conducted among prolific scholars in the field, various theoretical, methodological, and other guidelines for future research are provided.

Keywords: Importing * International business * Literature review

Introduction

Recent decades have witnessed a phenomenal growth in import trade, which has resulted from: The accelerated globalization of the world economy, intensified competition on a global scale, advancements taking place in the transportation, communication, and information technology, the increasing tendency by many manufacturing firms to move their plants to other countries, and the enhanced strategic role that purchasing plays in many organizations (Knudsen and Servais 2007; Swam idass 1993; Trent and Monczka 2005). A sizeable number of companies have acknowledged the crucial role of importing in acquiring products, raw materials, and even services at lower cost, better quality, and greater variety, thus enhancing their market and financial performance (Trent and Monczka 2002, 2003). Hence, at the moment, it is no more a question of whether to source internationally or not, but of how to manage this process effectively and efficiently (Murray 1996).

Notwithstanding its importance at the micro-business level, a number of controversies surround importing at the macro-economic level, namely: (a) the criticism that, unlike exports, imports do not contribute to economic development, despite indications that these can expand market size and demand domestically (Dodzin and Vamvakidis 2004); (b) the fact that setting trade barriers to protect infant industries incurs costs that in many cases are much higher than the benefits derived from this protection (Irwin 1991); (c) the adoption of protectionist or liberalist trade policies by a country may result in the protection or promotion respectively of one sector of the domestic economy at the expense of another (Bhagwati 1994); (d) the value dilemma confronted by many countries, which, in their attempt to import materials and products at lower cost from abroad, may overlook legislation relating to labor rights in the source country (Locke et al. 2007); and (e) the issues of national security involved when buying goods from a specific country, which in some cases are responsible for sacrificing serious benefits for the domestic economy (Moon 2000).

Despite its crucial nature, compared to other streams of international business research, importing has received relatively little theoretical and empirical attention from scholars in the field (Ghymn et al. 1999; Skarmeas and Katsikeas 2001). (1) In addition, the limited literature on the subject has often been described as too fragmented, disjointed, and unprogrammatic to yield any clear trends and guidelines (Ghymn and Jaffe 2004; Liang and Parkhe 1997). Although several insightful attempts have been made in the past to review and assess this body of research (e.g., Babbar and Prasad 1998a, b; Liang and Parkhe 1997; Quintens et al. 2006), they have been relatively limited in both scope and scale. For instance, the design, methodological, and thematic characteristics of importing studies have been tangentially tackled, while no analysis has been performed with regard to the evolutionary changes in this line of research.

In light of the above, the purpose of this article is to provide a comprehensive review and establish trends in the extant business literature on importing. In particular, it aims to provide answers to the following research questions: (a) What research designs have been adopted by empirical studies in the field? (b) What is the scope of research into importing, in terms of countries, industries, and firms? (c) What specific research methodologies have been adopted? (d) What key thematic areas and issues have been addressed by researchers in the field? and (e) What future areas of investigation can be proposed with regard to this line of academic inquiry?

This article contributes to the international business discipline in a number of ways: First, it compiles and synthesizes existing knowledge on importing, thus providing a useful inventory of knowledge for future scholars to build upon; second, it provides a comprehensive analysis of research designs, methodologies, and thematic areas addressed by researchers in the field; third, it critically analyzes the trends in the importing literature since the inception of this body of research; fourth, it detects various theoretical, methodological, empirical and other gaps that need to be remedied; and fifth, it systematically identifies and prioritizes new thematic areas and issues that would guide scholars who intend to work in this field in the future.

The remainder of the manuscript is divided into six sections. The following section offers a brief account of the evolution of importing within the domain of the international business discipline. In the third section, details of the investigation method employed in carrying out this review are presented. The next section comprises the findings of the study with regard to each of the research questions set, namely research design, scope of research, research methodology, and thematic areas. The final two sections include conclusions and recommendations for further research.

The Evolution of Importing Research

Although importing as an economic activity has existed since time immemorial, its theoretical roots (as in the case of exporting) were first addressed by economists in the pioneering work of Smith (1776), and the subsequent theories of comparative advantage by Ricardo (1817), factor endowments by Ohlin (1933) and Heckscher (1950), demand similarity by Linder (1961), and international product life-cycle by Vernon (1966). Although these theories offer useful insights in explaining international trade from a macroeconomic perspective, they provide only a limited understanding of the activities taking place at the micro-business level.

In response, O'Connell and Benson (1963) published the first business-oriented article on importing in the early 1960s, focusing on the benefits of the international sourcing of products, in terms of profitability and competitiveness for US firms. They were not only concerned with the purchasing of products and components from abroad, but also of employees and processes. In this decade, less-developed countries began to raise their productivity levels and export labor-intensive manufacture to developed countries. This posed an import threat to manufacturers based in economically advanced countries (Left 1974). During this period, very few articles on importing were published, mainly focusing on either macro-economic or industrial aspects of importing (e.g., Abdel-Malek 1969).

In the 1970s, there was a setback in the high rates of economic growth experienced since the end of the Second World War, attributable mainly to the breakdown of the Bretton Woods system, increases in oil prices, and economic recession in Western economies (Roberts and Fuller 2010). These problems, coupled with the emergence of new multinational firms from Europe, Japan and other Far East countries, increased competitive intensity and forced many firms to consider sourcing from abroad (Hefler 1981; Kotabe and Omura 1989; Left 1974). Western companies, especially those located in the US, embarked on restructuring programs, and this led to international production and later to more sophisticated supply chains (Roberts and Fuller 2010). Despite these crucial developments in the international business scene, surprisingly few academic articles were written on importing, mainly examining the product country-of-origin effects on the behavior of purchasing managers and macro-economic dimensions of importing.

The scope of import-related topics investigated by scholars in the field became more diversified in the 1980s, ranging from foreign source/supplier selection criteria and import motives to the problem of gray markets and the behavioral interactions of importers with their export suppliers. This was the era of neo-liberal economic policies, privatization and deregulation in both developed and developing economies of the world. US dominance in world trade was declining, with more and more competitors from other developed and newly-industrialized countries entering the international arena. Multinational corporations from Europe, Japan, and South Korea began to transfer their production facilities to low-cost locations, and US multinationals followed suit (Ghymn 1983; Kotabe and Omura 1989; Roberts and Fuller 2010).

The 1990s witnessed critical changes in the global business environment that favorably affected import operations, arousing the interest of a growing number of business scholars in the field. These changes were: (a) declining trade barriers, increases in regional trade agreements, amendments to international trade infrastructure, and the ending of decades of the Cold War; (b) the intensification of competition, which necessitated access to raw materials, components or finished goods on a global scale; (c) the increasing tendency to view imports as a way to secure cost, quality, technological and other competitive advantages; and (d) the exploitation of both the firm's own and its suppliers' competitive advantages in international markets, along with comparative...

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