This is a timely and brave book, given the widespread view that globalization means convergence among nations and companies toward common ways of doing things. Two of the authors are academics, and the other two are analysts at the U.S. Department of Commerce. The book has inspired passages such as this one: “However lustily they sing from the same hymnbook when they gather together in Davos or Aspen, the leaders of the world’s great business enterprises continue to differ in their most fundamental strategic behavior and objectives.” But most of it consists of factual analysis. The first half examines national differences among multinational companies based in Germany, Japan, and the United States; multinationals in France and Britain show up only briefly. Differences in corporate governance, especially ownership patterns, get most of the attention. The authors make the usual arguments about the strong role of banks in Japan and Germany, which invest for the long term. German managers have a great deal of autonomy except in crises, while their Japanese counterparts are often constrained by obligations arising from the corporate networks overseen by the banks. By contrast, the stock of U.S. companies is traded in blocks by short-term-oriented pension, insurance, and mutual funds. Although U.S. managers rarely face direct supervision, they are heavily influenced by movements in their company’s stock price.
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