- Elgar original reference
Edited by Günter K. Stahl and Ingmar Björkman
Chapter 23: International Human Resource Management and Economic Theories of the Firm
23 International human resource management and economic theories of the ﬁrm Marion Festing International human resource management (IHRM) is a discipline characterized by a variety of perspectives. Three main research areas will be described in the ﬁrst section of the chapter: human resource management (HRM) in multinational enterprises (MNEs), cross-cultural HRM and comparative international HRM (Dowling & Welch, 2004). The three perspectives are characterized by diﬀerent paradigms: the universalist and the contextual paradigm. The universalist paradigm suggests that rules derived from theoretical approaches can be applied independently of contextual considerations in order to improve HRM. In contrast, the contextual paradigm suggests that there are diﬀerent views on HRM and implies that it is more important to explain diﬀerences than to focus on ﬁrm performance (Brewster, 1999). Economic theory largely reﬂects the basic assumptions of the universalist paradigm. It is characterized by cost/beneﬁt arguments and may include a variety of theoretical perspectives. Consistent with other chapters in this volume, the focus of this chapter is on new institutional economics, that is, transaction cost theory, agency theory and property rights. Proponents implicitly assume that the reasoning of the new institutional economic perspectives is valid in all contexts and that local uniqueness (for example, a particular legal or cultural environment) either can be included in the respective frameworks or is inconsequential. Economic approaches may include contextual factors but, nevertheless, the universalist perspective dominates. The basic reasoning of the new institutional economic approaches is outlined in the second section of...
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