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An Inside Look at Emerging Economies
By Robbie Shell
Professor Mauro Guillén analyzes the role of business groups in South Korea,
Argentina and Spain. Within their histories lie clues to overall economic performance
The Asian financial crisis has hit Korea hard. But Taiwan is thriving.
In Latin America, Venezuela is in trouble, but Argentina looks like a
winner. What’s going on?
To some people, the term “emerging economy” evokes a one-size-fits-all
image of developing countries struggling, with mixed success,
to share in the prosperity of the global marketplace. Mauro Guillén,
however, doesn’t see it that way. By focusing a part of his research on
the rise and fall of business groups within these countries, he has
uncovered differences in how individual economies perform in both
internal and external markets.
“One emerging economy out of 40 goes down and suddenly
investors start panicking and getting out of all the others. We must
begin differentiating among these countries in a more sophisticated
way,” says Guillén, an assistant professor of management whose major
areas of interest include multinational and comparative management.
“After the Mexican economy collapsed in 1994-95, the next country
singled out for investors’ rage was Argentina,” he notes. “That
doesn’t make any sense. Not only are these two countries very far from
each other geographically, but the products they export are different,
they don’t compete in the same global markets and they don’t trade
with each other. Wall Street has just one category for emerging
economies so their response to any economic news is the same, regardless
of the individual circumstances.”
Guillén brings an unusual perspective to the issue of emerging
economies, an area he has studied since 1992 when he joined MIT’s
Sloan School of Management. A native of Leon, Spain, Guillén graduated
from the Universidad de Oviedo with a BA and PhD in political
economy and from Yale University with a master’s and PhD in sociology.
He has been at Wharton since 1996.
Most recently he has focused on the rise and fall of business groups
in emerging economies, including, for example, the Korean chaebol (e.g.
Samsung, Hyundai), the Indian business houses (e.g. Tata, Birla) the conglomerates
of Indonesia (e.g. Salim Group) and the Latin American and
Spanish grupos (e.g. Perez Companc in Argentina and El Corte Ingles
in Spain). While his research includes data from Brazil, Colombia,
India, Indonesia, Mexico and Taiwan, he has concentrated primarily on
the emerging economies of South Korea, Argentina and Spain.
Guillén defines business groups as a collection of firms that operate
in a wide variety of industries under unified entrepreneurial guidance.
These business groups grew, not because they were seeking financial
diversification, he says, but “as a result of their ability to set up new business
ventures across a variety of industries quickly and at low cost . . .
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