IDEAS home Printed from https://ideas.repec.org/a/bpj/buspol/v13y2011i4n3.html
   My bibliography  Save this article

Bargaining Model for the International Oil Industry

Author

Listed:
  • Vivoda Vlado

    (Griffith University)

Abstract

This paper establishes a model for analyzing the dynamics of the host state-international oil company (IOC) bargaining relationship. Theoretically, the model advances our ability to investigate bargaining dynamics between host states, oil companies and other stakeholders in the oil industry. It is a sophisticated mechanism which identifies the complex array of relationships and bargains within which the host state-IOC bargaining relationship is nested. The model builds on and leverages the key contributions of earlier bargaining models. It enables us to integrate relevant ideas from existing scholarship on host state-MNC bargaining while also taking into account other actors and bargains at domestic and international levels that affect bargaining between an IOC and a host state. Practically, the model will help actors choose strategies more systematically, leading to higher relative bargaining power that may translate to preferable bargaining outcomes.

Suggested Citation

  • Vivoda Vlado, 2011. "Bargaining Model for the International Oil Industry," Business and Politics, De Gruyter, vol. 13(4), pages 1-36, December.
    • Handle: RePEc:bpj:buspol:v:13:y:2011:i:4:n:3
    DOI: 10.2202/1469-3569.1384
    as

    Download full text from publisher

    File URL: https://doi.org/10.2202/1469-3569.1384
    Download Restriction: For access to full text, subscription to the journal or payment for the individual article is required.
    File URL: https://libkey.io/10.2202/1469-3569.1384?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Theodore H. Moran, 1998. "Foreign Direct Investment and Development: The New Policy Agenda for Developing Countries and Economies in Transition," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 53, October.
    2. Stephen E Weiss, 1990. "The Long Path to the IBM-Mexico Agreement: An Analysis of the Microcomputer Investment Negotiations 1983–86," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 21(4), pages 565-596, December.
    3. Belanger, Yale D. & Williams, Robert J., 2011. "Neoliberalism as Colonial Embrace: Evaluating Alberta's Regulation of First Nations Gaming, 1993–2010," Business and Politics, Cambridge University Press, vol. 13(4), pages 1-34, December.
    4. Gould John A & Winters Matthew S, 2007. "An Obsolescing Bargain in Chad: Shifts in Leverage between the Government and the World Bank," Business and Politics, De Gruyter, vol. 9(2), pages 1-36, September.
    5. Ravi Ramamurti, 2001. "The Obsolescing ‘Bargaining Model’? MNC-Host Developing Country Relations Revisited," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 32(1), pages 23-39, March.
    6. Sushil Vachani, 1995. "Enhancing the Obsolescing Bargain Theory: A Longitudinal Study of Foreign Ownership of U.S. and European Multinationals," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 26(1), pages 159-180, March.
    7. T Agmon, 2003. "Who gets what: the MNE, the national state and the distributional effects of globalization," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 34(5), pages 416-427, September.
    8. Klein, Benjamin & Crawford, Robert G & Alchian, Armen A, 1978. "Vertical Integration, Appropriable Rents, and the Competitive Contracting Process," Journal of Law and Economics, University of Chicago Press, vol. 21(2), pages 297-326, October.
    9. Joe S. Bain, 1951. "Relation of Profit Rate to Industry Concentration: American Manufacturing, 1936–1940," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 65(3), pages 293-324.
    10. Benjamin Gomes-Casseres, 1990. "Firm Ownership Preferences and Host Government Restrictions: An Integrated Approach," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 21(1), pages 1-22, March.
    11. Lorraine Eden & Stefanie Lenway, 2001. "Introduction to the Symposium Multinationals: The Janus Face of Globalization*," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 32(3), pages 383-400, September.
    12. Gomes-Casseres, Benjamin, 1989. "Ownership structures of foreign subsidiaries : Theory and evidence," Journal of Economic Behavior & Organization, Elsevier, vol. 11(1), pages 1-25, January.
    13. Vivoda, Vlado, 2011. "Bargaining Model for the International Oil Industry," Business and Politics, Cambridge University Press, vol. 13(4), pages 1-34, December.
    14. Doh, Jonathan P. & Teegen, Hildy, 2002. "Nongovernmental organizations as institutional actors in international business: theory and implications," International Business Review, Elsevier, vol. 11(6), pages 665-684, December.
    15. Martin J. Osborne & Ariel Rubinstein, 1994. "A Course in Game Theory," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262650401, December.
    16. Levy David L. & Kolk Ans, 2002. "Strategic Responses to Global Climate Change: Conflicting Pressures on Multinationals in the Oil Industry," Business and Politics, De Gruyter, vol. 4(3), pages 1-27, November.
    17. Putnam, Robert D., 1988. "Diplomacy and domestic politics: the logic of two-level games," International Organization, Cambridge University Press, vol. 42(3), pages 427-460, July.
    18. Vlado Vivoda, 2010. "International oil companies, US Government and energy security policy: an interest-based analysis," International Journal of Global Energy Issues, Inderscience Enterprises Ltd, vol. 33(1/2), pages 73-88.
    19. Regnier, Eva, 2007. "Oil and energy price volatility," Energy Economics, Elsevier, vol. 29(3), pages 405-427, May.
    20. Gould, John A. & Winters, Matthew S., 2007. "An Obsolescing Bargain in Chad: Shifts in Leverage between the Government and the World Bank," Business and Politics, Cambridge University Press, vol. 9(2), pages 1-34, August.
    21. Levy David L. & Prakash Aseem, 2003. "Bargains Old and New: Multinational Corporations in Global Governance," Business and Politics, De Gruyter, vol. 5(2), pages 1-21, December.
    22. Levy, David L. & Prakash, Aseem, 2003. "Bargains Old and New: Multinational Corporations in Global Governance," Business and Politics, Cambridge University Press, vol. 5(2), pages 131-150, August.
    23. Keasey, Kevin & Moon, Philip, 2000. "Sunk cost effects: a test of the importance of context," Economics Letters, Elsevier, vol. 66(1), pages 55-58, January.
    24. Ramamurti, Ravi & Doh, Jonathan P., 2004. "Rethinking foreign infrastructure investment in developing countries," Journal of World Business, Elsevier, vol. 39(2), pages 151-167, May.
    25. Gourevitch, Peter Alexis, 1996. "Squaring the Circle: The Domestic Sources of International Cooperation," International Organization, Cambridge University Press, vol. 50(2), pages 349-373, April.
    26. Thomas L Brewer, 1992. "An Issue-Area Approach to the Analysis of MNE-Government Relations," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 23(2), pages 295-309, June.
    27. Keith Weigelt & Colin Camerer, 1988. "Reputation and corporate strategy: A review of recent theory and applications," Strategic Management Journal, Wiley Blackwell, vol. 9(5), pages 443-454, September.
    28. Teegen, Hildy, 2003. "International NGOs as global institutions: using social capital to impact multinational enterprises and governments," Journal of International Management, Elsevier, vol. 9(3), pages 271-285.
    29. Donald J Lecraw, 1984. "Bargaining Power, Ownership, and Profitability of Transnational Corporations in Developing Countries," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 15(1), pages 27-43, March.
    30. Laura Hosman, 2009. "Dividing the Oils: Dynamic Bargaining as Policy Formation in the Nigerian Petroleum Industry," Review of Policy Research, Policy Studies Organization, vol. 26(5), pages 609-632, September.
    31. Mayer, Frederick W., 1992. "Managing domestic differences in international negotiations: the strategic use of internal side-payments," International Organization, Cambridge University Press, vol. 46(4), pages 793-818, October.
    32. Thomas A Poynter, 1982. "Government Intervention in Less Developed Countries: The Experience of Multinational Companies," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 13(1), pages 9-25, March.
    33. James Nebus & Carlos Rufin, 2010. "Extending the bargaining power model: Explaining bargaining outcomes among nations, MNEs, and NGOs," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 41(6), pages 996-1015, August.
    34. Levy, David L. & Kolk, Ans, 2002. "Strategic Responses to Global Climate Change: Conflicting Pressures on Multinationals in the Oil Industry," Business and Politics, Cambridge University Press, vol. 4(3), pages 275-300, November.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Pang, Yu, 2019. "Taxing pollution and profits: A bargaining approach," Energy Economics, Elsevier, vol. 78(C), pages 278-288.
    2. Monaldi, Francisco & Hernández, Igor & La Rosa Reyes, José, 2021. "The collapse of the Venezuelan oil industry: The role of above-ground risks limiting foreign investment," Resources Policy, Elsevier, vol. 72(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Gamso, Jonas & Nelson, Roy C., 2019. "Does partnering with the World Bank shield investors from political risks in less developed countries?," Journal of World Business, Elsevier, vol. 54(5), pages 1-1.
    2. Charles E. Stevens & En Xie & Mike W. Peng, 2016. "Toward a legitimacy-based view of political risk: The case of Google and Yahoo in China," Strategic Management Journal, Wiley Blackwell, vol. 37(5), pages 945-963, May.
    3. Müllner, Jakob & Puck, Jonas, 2018. "Towards a holistic framework of MNE–state bargaining: A formal model and case-based analysis," Journal of World Business, Elsevier, vol. 53(1), pages 15-26.
    4. Yorgos Rizopoulos & Dimitrios E Sergakis, 2010. "MNEs and policy networks: Institutional embeddedness and strategic choice," Post-Print halshs-01968233, HAL.
    5. Doh, Jonathan P. & Dahan, Nicolas M. & Casario, Michelle, 2022. "MNEs and the practice of international business diplomacy," International Business Review, Elsevier, vol. 31(1).
    6. Mehmet Demirbag & Ekrem Tatoglu & Keith W. Glaister, 2008. "Factors affecting perceptions of the choice between acquisition and greenfield entry: The case of Western FDI in an emerging market," Management International Review, Springer, vol. 48(1), pages 5-38, February.
    7. Bailey, Nicholas & Warby, Brian, 2019. "Explaining the competition for FDI: Evidence from Costa Rica and cross-national industry-level FDI data," Research in International Business and Finance, Elsevier, vol. 47(C), pages 67-77.
    8. Zhao, Hongxin & Zhu, Gangti, 1998. "Determinants of ownership preference of international joint ventures: new evidence from Chinese manufacturing industries," International Business Review, Elsevier, vol. 7(6), pages 569-589, November.
    9. Lee, Ji-Ren & Chen, Wei-Ru & Kao, Charng, 2003. "Determinants and performance impact of asymmetric governance structures in international joint ventures: an empirical investigation," Journal of Business Research, Elsevier, vol. 56(10), pages 815-828, October.
    10. Rizopoulos, Yorgos A. & Sergakis, Dimitrios E., 2010. "MNEs and policy networks: Institutional embeddedness and strategic choice," Journal of World Business, Elsevier, vol. 45(3), pages 250-256, July.
    11. Erdener Kaynak & Mehmet Demirbag & Ekrem Tatoglu, 2007. "Determinants of ownership-based entry mode choice of MNEs: Evidence from Mongolia," Management International Review, Springer, vol. 47(4), pages 505-530, October.
    12. Arora, Ashish & Fosfuri, Andrea, 1999. "Exploring the internalization rationale for international investment: wholly owned subsidiary versus technology licensing in the worldwide chemical industry," DEE - Working Papers. Business Economics. WB 6430, Universidad Carlos III de Madrid. Departamento de Economía de la Empresa.
    13. Yadong Luo & Huan Zhang & Juan Bu, 2019. "Developed country MNEs investing in developing economies: Progress and prospect," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 50(4), pages 633-667, June.
    14. Simon Hartmann & Thomas Lindner & Jakob Müllner & Jonas Puck, 2022. "Beyond the nation-state: Anchoring supranational institutions in international business research," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 53(6), pages 1282-1306, August.
    15. Iavor Marangozov, 2005. "From Practice to Theory of the International Joint Ventures," Economic Studies journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 2, pages 44-77.
    16. Drogendijk, H.J., 2005. "The Development of Network Relations of MNC Subsidiaries : How Internal MNC and External (Local) Relations Evolve," Discussion Paper 2005-128, Tilburg University, Center for Economic Research.
    17. Vachani, Sushil, 2005. "Problems of foreign subsidiaries of SMEs compared with large companies," International Business Review, Elsevier, vol. 14(4), pages 415-439, August.
    18. Oetzel, Jennifer, 2005. "Smaller may be beautiful but is it more risky? Assessing and managing political and economic risk in Costa Rica," International Business Review, Elsevier, vol. 14(6), pages 765-790, December.
    19. Jakobsen, Jo, 2010. "Old problems remain, new ones crop up: Political risk in the 21st century," Business Horizons, Elsevier, vol. 53(5), pages 481-490, September.
    20. Desai, Mihir A. & Foley, C. Fritz & Hines, James Jr., 2004. "The costs of shared ownership: Evidence from international joint ventures," Journal of Financial Economics, Elsevier, vol. 73(2), pages 323-374, August.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bpj:buspol:v:13:y:2011:i:4:n:3. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Peter Golla (email available below). General contact details of provider: https://www.degruyter.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.