Rawi E. Abdelal

Herbert F. Johnson Professor of International Management
Chair, MBA Required Curriculum

Rawi Abdelal is the Herbert F. Johnson Professor of International Management at Harvard Business School and the Chair of the MBA Required Curriculum. His primary expertise is international political economy, and his research focuses on the politics of globalization and the political economy of Eurasia. Professor Abdelal is a faculty associate of Harvard's Weatherhead Center for International Affairs and de Gunzburg Center for European Studies, and he serves on the executive committee of the Davis Center for Russian and Eurasian Studies.

Professor Abdelal's first book, National Purpose in the World Economy, won the 2002 Shulman Prize as the outstanding book on the international relations of eastern Europe and the former Soviet Union. Abdelal's second book, Capital Rules, explains the evolution of the social norms and legal rules of the international financial system. Abdelal has also edited or co-edited three books: The Rules of Globalization, a collection of Harvard Business School cases on international business; Measuring Identity; and Constructing the International Economy. Abdelal is currently at work on The Profits of Power, a book that explores the geopolitics of energy in Europe and Eurasia.

In 1999 Abdelal earned a Ph.D. in Government from Cornell University, where he had received an M.A. in 1997. At Cornell Abdelal's dissertation won the Kahin Prize in International Relations and the Esman Prize. He was a President's Scholar at the Georgia Institute of Technology, where he received a B.S. with highest honors in Economics in 1993. Recent honors include Harvard Business School's Greenhill Award, Apgar Award for innovation in teaching, and Williams Award for excellence in teaching, as well as, on several occasions, the Student Association's Faculty Award for outstanding teaching.

February 2013


Rawi Abdelal | E-mail: rabdelal@hbs.edu

Books

  1. Constructing the International Economy

    Keywords: Economy;

    Citation:

    Abdelal, Rawi, Mark Blyth, and Craig Parsons, eds. Constructing the International Economy. Ithaca, NY: Cornell University Press, 2010.
  2. Measuring Identity

    Keywords: Measurement and Metrics; Identity;

    Citation:

    Abdelal, Rawi, Yoshiko M. Herrera, Alastair Iain Johnston, and Rose McDermott, eds. Measuring Identity. Cambridge: Cambridge University Press, 2009.
  3. The Rules of Globalization: Case Book

    This is a book about the politics of the global economy — about how firms prosper by understanding those politics, or fail by misunderstanding them. Understanding the politics of globalization may once have been a luxury; it is now, for most high-level managers, simply a necessity. The book contains cases which can be used by instructors and students to build a framework of analysis that enables them to understand the challenges of international trade and investment and master the opportunities they represent. This framework is based on a systematic evaluation of the informal and formal rules that define markets for goods, services, and capital. These insightful cases allow for evaluation of: the political and economic origins of our current era of globalization and how the rules that constrain and enable firms are changing; the impact of governments' policies and which tools are available for predicting, avoiding, or even employing the long arm of the government; and the influence of informal and formal institutions on opportunities for success in international finance and trade.

    Keywords: Trade; International Finance; Globalized Economies and Regions; Governing Rules, Regulations, and Reforms; Policy; Government and Politics; Business and Government Relations;

    Citation:

    Abdelal, Rawi, ed. The Rules of Globalization: Case Book. Singapore: World Scientific, 2008.
  4. Capital Rules: The Construction of Global Finance

    Keywords: Capital; Governing Rules, Regulations, and Reforms; Finance;

    Citation:

    Abdelal, Rawi. Capital Rules: The Construction of Global Finance. Cambridge, MA: Harvard University Press, 2007.
  5. National Purpose in the World Economy: Post-Soviet States in Comparative Perspective

    Citation:

    Abdelal, Rawi. National Purpose in the World Economy: Post-Soviet States in Comparative Perspective. Ithaca, NY: Cornell University Press, 2001.

Journal Articles

  1. The Profits of Power: Commerce and Realpolitik in Eurasia

    Although the energy trade is the single most important element of nearly all European countries' relations with Russia, Europe has been divided by both worldview and practice. Why, in the face of the common challenge of dependence on imported Russian gas, have national reactions to such vulnerability varied so dramatically across the continent? And why have a handful of French, German, and Italian corporations somehow taken responsibility for formulating the energy strategy–and thus the Russia policy–for essentially all of Europe? The resolutions of these two puzzles are, I show, interlinked; they also demand theoretical innovation. With several case studies–of Gazprom's decision making during the 2006 and 2009 gas crises and of the response of western and central Europe to their gas dependence–I find that firms are driving these political outcomes; those firms are motivated by profits but employ sociological conventions along their ways; and firms generally seek the necessary inter-firm, cross-border cooperation that will deliver corporate performance. Finally, I conclude that the field will ultimately require a framework that puts firms at its center.

    Keywords: Performance; Cross-Cultural and Cross-Border Issues; Globalized Firms and Management; Profit; Framework; Corporate Strategy; Innovation and Invention; Policy; Decision Choices and Conditions; Crisis Management; Government and Politics; Energy Industry; Europe; Russia; France; Germany; Italy;

    Citation:

    Abdelal, Rawi. "The Profits of Power: Commerce and Realpolitik in Eurasia." Review of International Political Economy 20, no. 3 (June 2013): 421–456.
  2. Managed Globalization: Doctrine, Practice, and Promise

    Two alternate visions for shaping and explaining the governance of economic globalization have been in competition for the past 20 years: an ad hoc, laissez-faire vision promoted by the United States versus a managed vision relying on multilateral rules and international organizations promoted by the European Union. Although the American vision prevailed in the past decade, the current worldwide crisis gives a new life and legitimacy to the European vision. This essay explores how this European vision, often referred to as 'managed globalization,' has been conceived and implemented and how the rules that Europe fashioned in trade and finance actually shaped the world economy. In doing so, we highlight the paradox that managed globalization has been a force for liberalization.

    Keywords: Financial Crisis; Trade; Globalized Economies and Regions; Governing Rules, Regulations, and Reforms; Competition; European Union; United States;

    Citation:

    Abdelal, Rawi, and Sophie Meunier. "Managed Globalization: Doctrine, Practice, and Promise." Journal of European Public Policy 17, no. 3 (April 2010): 349–366.
  3. The Promise and Peril of Russia's Resurgent State

    The article discusses the effect of the global financial crisis of 2008-2009 on the outlook for Russia's economic growth. The discussion focuses on the status of capitalism in Russia and the government's central role in business. A brief history of Russia's economic policy and business conditions since 2000 is given. The growth of Russia's economy and the fiscal surpluses resulting from high oil prices are mentioned. The experiences of Royal Dutch Shell, British Petroleum Co. PLC, and Enel SpA, which made business investments in Russia, are also discussed.

    Keywords: Economic Growth; Economic Systems; Financial Crisis; Investment; Globalized Economies and Regions; Policy; Russia;

    Citation:

    Abdelal, Rawi. "The Promise and Peril of Russia's Resurgent State." Harvard Business Review 88, no. 1 (January–February 2010): 125–129.
  4. Sovereign Wealth in Abu Dhabi

    By the turn of the century, oil had already made the tiny emirate of Abu Dhabi rich beyond anyone's wildest dreams. A sovereign wealth fund, the Abu Dhabi Investment Authority (ADIA), has invested extra oil revenues abroad for more than thirty years and amassed a still-growing portfolio worth approximately $750-900 billion. ADIA is widely believed to be the world's largest sovereign wealth fund—indeed the world's largest institutional investor. But Abu Dhabi is not yet a "developed" economy. So, in 2002, the Mubadala Development Company was established as a government-owned investment vehicle. Unlike ADIA's mandate to build and manage a financial portfolio, Mubadala's charge was to develop Abu Dhabi. According to some observers, ADIA was a "sovereign savings fund," while Mubadala was a government-owned investment firm. Mubadala is supposed to invest the wealth of the emirate in activities that would diversify the economy away from energy and into industry and services. Although each Mubadala investment is supposed to earn large returns, the strategy balances financial against "strategic" returns. ADIA and Mubadala are the institutional architecture to manage the wealth of the Abu Dhabi sovereign.

    Keywords: Development Economics; Financial Management; Investment Funds; Sovereign Finance; Wealth; Diversification; Abu Dhabi;

    Citation:

    Abdelal, Rawi. "Sovereign Wealth in Abu Dhabi." Geopolitics 14, no. 2 (April 2009): 317–327.
  5. Where Oil-Rich Nations Are Placing Their Bets

    Keywords: Wealth; Energy;

    Citation:

    Abdelal, Rawi, Ayesha Khan, and Tarun Khanna. "Where Oil-Rich Nations Are Placing Their Bets." Harvard Business Review 86, no. 9 (September 2008): 119–128.
  6. Mondialisation: la French Touch

    Citation:

    Abdelal, Rawi, and Sophie Meunier. "Mondialisation: la French Touch." Telos (October 2007).
  7. Has Globalization Passed Its Peak?

    Keywords: Globalization;

    Citation:

    Abdelal, Rawi, and Adam Segal. "Has Globalization Passed Its Peak?" Foreign Affairs 86, no. 1 (January/February 2007): 103–114. (Abridged and reprinted in International Politics: Enduring Concepts and Contemporary Issues, ninth edition, ed. Robert J. Art and Robert Jervis. New York: Longman, 2009, pp. 340-346.)
  8. Identity as a Variable

    Keywords: Identity;

    Citation:

    Abdelal, Rawi, Yoshiko M. Herrera, Alastair Iain Johnston, and Rose McDermott. "Identity as a Variable." Perspectives on Politics 4, no. 4 (December 2006): 695–711.
  9. Writing the Rules of Global Finance: France, Europe, and Capital Liberalization

    Keywords: Finance; Governing Rules, Regulations, and Reforms; Capital; France; Europe;

    Citation:

    Abdelal, Rawi. "Writing the Rules of Global Finance: France, Europe, and Capital Liberalization." Review of International Political Economy 13, no. 1 (February 2006): 1–27.
  10. To Judge Leviathan: Sovereign Credit Ratings, National Law, and the World Economy

    Keywords: Sovereign Finance; Credit; Law; Economy;

    Citation:

    Bruner, Christopher, and Rawi Abdelal. "To Judge Leviathan: Sovereign Credit Ratings, National Law, and the World Economy." Journal of Public Policy 25, no. 2 (August 2005): 191–217.
  11. Le consensus de Paris: la France et les règles de la finance mondiale

    Citation:

    Abdelal, Rawi. "Le consensus de Paris: la France et les règles de la finance mondiale." Critique internationale, no. 28 (July/September 2005): 87–115.
  12. Capital and Control: Lessons from Malaysia

    Keywords: Capital; Malaysia;

    Citation:

    Abdelal, Rawi, and Laura Alfaro. "Capital and Control: Lessons from Malaysia." Challenge 46, no. 4 (July/August 2003): 36–53. (Also published in French as "Contrôle des capitaux: les enseignements de l’expérience malaisienne." Problèmes économiques, no. 2,837 (December 2003), pp. 21-28.)
  13. Contested Currency: Russia's Ruble in Domestic and International Politics

    Keywords: Currency; Government and Politics; Russia;

    Citation:

    Abdelal, Rawi. "Contested Currency: Russia's Ruble in Domestic and International Politics." Journal of Communist Studies and Transition Politics 19, no. 2 (June 2003): 55–76. (Reprinted in Perspectives on the Russian State in Transition, ed. Wolfgang Danspeckgruber. Princeton, N.J.: Woodrow Wilson School of Public and International Affairs, 2006, pp. 197-219.)
  14. Purpose and Privation: Nation and Economy in Post-Habsburg Eastern Europe and Post-Soviet Eurasia

    Keywords: Economy; Europe;

    Citation:

    Abdelal, Rawi. "Purpose and Privation: Nation and Economy in Post-Habsburg Eastern Europe and Post-Soviet Eurasia." Eastern European Politics and Societies 16, no. 3 (fall 2002): 898–933.
  15. Memories of Nations and States: Institutional History and National Identity in Post-Soviet Eurasia

    Keywords: History; Global Range; Identity; Soviet Union;

    Citation:

    Abdelal, Rawi. "Memories of Nations and States: Institutional History and National Identity in Post-Soviet Eurasia." Nationalities Papers 30, no. 3 (September 2002): 459–484.
  16. Strategy, Economic Relations, and the Definition of National Interests

    Keywords: Strategy; Economics;

    Citation:

    Abdelal, Rawi, and Jonathan Kirshner. "Strategy, Economic Relations, and the Definition of National Interests." Security Studies 9, nos. 1-2 (autumn–winter 1999–2000): 119–156. (Reprinted in Power and the Purse: Economic Statecraft, Interdependence, and National Security, ed. Jean-Marc F. Blanchard, Edward D. Mansfield, and Norrin M. Ripsman. London: Frank Cass, 2000, pp. 119-156.)
  17. The Politics of Monetary Leadership and Followership: Stability in the European Monetary System Since the Currency Crisis of 1992

    Despite widespread scepticism, there is a fundamental continuity in the stability of the European Monetary System (EMS) before and after the 1992 crisis. Although speculative pressures provoked European leaders to widen the fluctuation bands of the Exchange Rate Mechanism (ERM), thus altering substantially the official commitment of member governments to coordinate monetary policies and exchange rates, the values of currencies in the hardcore of the EMS have remained close to their pre-crisis parities with limited fluctuations. European monetary cooperation continues informally, achieving much more stability than the wide bands suggest. The task of the article is to explain the puzzling continued success of the EMS. First, this article re-specifies the problem of international monetary cooperation as a leader–follower interaction with inherently hierarchical attributes. Second, the article outlines the causes of exchange-rate stability in Europe. Finally, the article emphasizes that French monetary followership is the key to the stability of the post-crisis arrangement and offers a preliminary interpretation of the sources of French behaviour.

    Keywords: Money; Leadership; System; Balance and Stability; Europe;

    Citation:

    Abdelal, Rawi. "The Politics of Monetary Leadership and Followership: Stability in the European Monetary System Since the Currency Crisis of 1992." Political Studies 46, no. 2 (June 1998): 236–259. (Winner of Harrison Prize Awarded each year for the best article published by Political Studies in that volume.)

Book Chapters

  1. Just Who Put You in Charge? We Did: Credit Rating Agencies and the Politics of Ratings

    Citation:

    Abdelal, Rawi, and Mark Blyth. "Just Who Put You in Charge? We Did: Credit Rating Agencies and the Politics of Ratings." In Ranking the World: Grading States as a Tool of Global Governance, edited by Alexander Cooley and Jack Snyder. Cambridge: Cambridge University Press, forthcoming.
  2. Disjoining Partners: Europe and the American Imperium

    Citation:

    Abdelal, Rawi, and Ulrich Krotz. "Disjoining Partners: Europe and the American Imperium." In Power in a Complex Global System, edited by Bruce W. Jentleson and Louis W. Pauly. London: Routledge, forthcoming.
  3. Constructing the International Economy

    Keywords: Globalized Economies and Regions; Globalization; Economy; Trade;

    Citation:

    Abdelal, Rawi, Mark Blyth, and Craig Parsons. "Constructing the International Economy." Introduction to Constructing the International Economy, edited by Rawi Abdelal, Mark Blyth, and Craig Parsons, 1–19. Ithaca, NY: Cornell University Press, 2010.
  4. Re-Constructing IPE: Some Conclusions Drawn from a Crisis

    Citation:

    Abdelal, Rawi, Mark Blyth, and Craig Parsons. "Re-Constructing IPE: Some Conclusions Drawn from a Crisis." In Constructing the International Economy, edited by Rawi Abdelal, Mark Blyth, and Craig Parsons, 227–239. Ithaca, NY: Cornell University Press, 2010.
  5. The Principles of Embedded Liberalism: Social Legitimacy and Global Capitalism

    In this essay we revisit the principles of “embedded liberalism” and argue for their relevance to the contemporary global economy. The most essential principle is the need for markets to enjoy social legitimacy, because their political sustainability ultimately depends on it. From this principle we analyze three current sets of practices and institutions in which ongoing crises of legitimacy demonstrate the need for a renewal of embedded liberalism and a revitalization of global governance. They are as follows: the activities of transnational corporations, particularly with regard to core standards in labor and human rights; the organization of the international financial architecture; and the formal rules and informal norms of international organizations.

    Keywords: Economic Systems; Ethics; International Finance; Globalization; Multinational Firms and Management; Corporate Governance; Governing Rules, Regulations, and Reforms; Labor;

    Citation:

    Abdelal, Rawi, and John G. Ruggie. "The Principles of Embedded Liberalism: Social Legitimacy and Global Capitalism." In New Perspectives on Regulation, edited by David Moss and John Cisternino, 151–162. Cambridge, MA: Tobin Project, 2009.
  6. Introduction

    Citation:

    Abdelal, Rawi, Yoshiko M. Herrera, Alastair Iain Johnston, and Rose McDermott. "Introduction." Introduction to Measuring Identity, edited by Rawi Abdelal, Yoshiko M. Herrera, Alastair Iain Johnston, and Rose McDermott, 1–13. Cambridge: Cambridge University Press, 2009.
  7. Identity as a Variable

    Keywords: Identity; Measurement and Metrics; Mathematical Methods;

    Citation:

    Abdelal, Rawi, Yoshiko M. Herrera, Alastair Iain Johnston, and Rose McDermott. "Identity as a Variable." In Measuring Identity, edited by Rawi Abdelal, Yoshiko M. Herrera, Alastair Iain Johnston, and Rose McDermott, 17–32. Cambridge: Cambridge University Press, 2009.
  8. Constructivism as an Approach to International Political Economy

    This Handbook gives an overview of the range and scope of International Political Economy (IPE) scholarship by mapping the different regional schools of IPE and noting the distinctive way IPE is practiced and conceptualized around the world. The Handbook examines, in a series of introductory chapters written by leading figures in each region, the evolution of IPE in the US, Canada, the UK, Asia, and Australia. These introductory chapters map out the contending approaches and key concerns that exist within each regional school. In each regional section, following the introductory chapter, chapters tackling key areas of IPE scholarship such as trade and development, finance, and global governance/globalization follow. Each chapter will be written by an established scholar and will showcase the particular approach(es) highlighted in the region-specific introduction.

    Keywords: Development Economics; Trade; Higher Education; Globalized Economies and Regions; Government and Politics;

    Citation:

    Abdelal, Rawi. "Constructivism as an Approach to International Political Economy." In Handbook of International Political Economy, edited by Mark Blyth, 57–71. London: Routledge, 2009.
  9. The IMF and the Capital Account

    Keywords: International Finance; Capital;

    Citation:

    Abdelal, Rawi. "The IMF and the Capital Account." In Reforming the IMF for the 21st Century, edited by Edwin M. Truman, 185–197. Washington, D.C.: Institute for International Economics, 2006.
  10. Nationalism and International Political Economy in Eurasia

    Keywords: Government and Politics; Economics; Europe; Asia;

    Citation:

    Abdelal, Rawi. "Nationalism and International Political Economy in Eurasia." In Economic Nationalism in a Globalizing World, edited by Eric Helleiner and Andreas Pickel, 21–43. Ithaca, NY: Cornell University Press, 2005.
  11. Markets and Meanings: Nationalism, Land, and Property in Lithuania

    Keywords: Markets; Property; Government and Politics; Lithuania;

    Citation:

    Abdelal, Rawi. "Markets and Meanings: Nationalism, Land, and Property in Lithuania." In Land Rights, Ethno-Nationality, and Sovereignty in History, edited by Stanley L. Engerman and Jacob Metzer, 111–127. New York: Routledge, 2004.
  12. Theodore Levitt's 'The Globalization of Markets': An Evaluation After Two Decades

    Keywords: Globalized Markets and Industries;

    Citation:

    Tedlow, Richard S., and Rawi Abdelal. "Theodore Levitt's 'The Globalization of Markets': An Evaluation After Two Decades." In The Global Market: Developing a Strategy to Manage Across Borders, edited by John A. Quelch and Rohit Deshpandé, 11–30. San Francisco, CA: Jossey-Bass, 2004.
  13. Interpreting Interdependence: National Security and the Energy Trade of Russia, Ukraine, and Belarus

    Keywords: Energy; Trade; International Relations; National Security; Globalized Economies and Regions; Globalized Markets and Industries; Energy Industry; Russia; Ukraine; Belarus;

    Citation:

    Abdelal, Rawi. "Interpreting Interdependence: National Security and the Energy Trade of Russia, Ukraine, and Belarus." In Swords and Sustenance: The Economics of Security in Belarus and Ukraine, edited by Robert Legvold and Celeste Wallander, 101–127. Cambridge, MA: MIT Press, 2004. (Also published in Russian as "Razlichnoe ponimanie vzaimozavisimosti: natsional’naia bezopasnost’ i torgovlia energoresursami mezhdu Rossiei, Ukrainoi, i Belarus’iu." In Mechi i orala: ekonomika natsional’noi bezopasnosti Belarusi i Ukrainy, ed. Robert Legvold and Celeste Wallander. Moscow: Interdialect, 2004, pp. 125-156.)
  14. National Strategy and National Money: Politics and the End of the Ruble Zone, 1991-94

    Keywords: Government and Politics; Strategy; Money; Policy; International Relations; Currency; Russia;

    Citation:

    Abdelal, Rawi. "National Strategy and National Money: Politics and the End of the Ruble Zone, 1991-94." In Monetary Orders, edited by Jonathan Kirshner, 98–124. Ithaca, NY: Cornell University Press, 2003.

Other Publications and Materials

  1. U.S.-Russia Relations and the Hydrocarbon Markets of Eurasia

    Citation:

    Abdelal, Rawi, and Tatiana Mitrova. "U.S.-Russia Relations and the Hydrocarbon Markets of Eurasia." White Paper, December 2012.
  2. Politics and Natural Gas in Russia

    Citation:

    Abdelal, Rawi. "Politics and Natural Gas in Russia." May 2012.
  3. The Putin Pendulum: The Crisis and the End of Russia's Age of Revolution

    Keywords: History; Russia;

    Citation:

    Abdelal, Rawi. "The Putin Pendulum: The Crisis and the End of Russia's Age of Revolution." October 2011.

Cases and Teaching Materials

  1. Ukraine: On the Border of Europe and Eurasia

    In the fall of 2013, the people of Ukraine disagreed passionately whether their country should intensify ties with the European Union or Russia. After President Yanukovych rejected the free trade agreement with the EU in November, thousands of Ukrainians peacefully protested. But the protest movement morphed into a violent, deadly confrontation in January, culminating in February in mass slaughter, an overthrow of government, foreign invasion, and international crisis. The four months that shook Ukraine is a case study on the interrelated problems of geopolitical struggle, politics of economic pacts and clash of regional economic blocks, post-imperial disintegration and trade, and identity and interdependence.

    Keywords: Decision Making; Cost vs Benefits; Decision Choices and Conditions; Decisions; Forecasting and Prediction; Judgments; Geopolitical Units; Country; Globalization; Cross-Cultural and Cross-Border Issues; Global Strategy; Globalized Economies and Regions; Globalized Markets and Industries; Government and Politics; International Relations; National Security; Growth and Development; History; Europe; Ukraine; European Union; Russia;

    Citation:

    Abdelal, Rawi, Rafael M. Di Tella, and Sogomon Tarontsi. "Ukraine: On the Border of Europe and Eurasia." Harvard Business School Case 714-042, March 2014.
  2. Latvia: Navigating the Strait of Messina (TP)

    Citation:

    Abdelal, Rawi, Rafael Di Tella, and Natalie Kindred. "Latvia: Navigating the Strait of Messina (TP)." Harvard Business School Teaching Plan 713-010, April 2013.
  3. Romney vs. Obama and U.S. Energy Policy

    In 2012, the energy sector in the United States was demanding major reform. Prices of oil and gas had continued to cripple the middle and lower class as the U.S. economy slowly recovered. At the same time, the U.S. lagged behind developed economies in production of renewable energy. The acceptance of climate change remained a partisan issue. The development of hydraulic fracturing (fracking) promised an abundance of accessible, cheap, domestically produced natural gas, but the cost to the environment remained a point of debate. As incumbent Democratic President Barack Obama faced Republican opponent Mitt Romney in the 2012 election, their (and their parties') stances on energy policy and the environment differed in several major areas. The results of the election would shape the country's energy policy for at least the next four years and potentially create enough momentum to set energy policy of the United States for many years to come.

    Keywords: Mitt Romney; Barack Obama; energy; election outcomes; Weather and Climate Change; Renewable Energy; Political Elections; Policy; Business and Government Relations; Public Administration Industry; United States;

    Citation:

    Abdelal, Rawi, and Kaitlyn Tuthill. "Romney vs. Obama and U.S. Energy Policy." Harvard Business School Case 713-050, October 2012.
  4. Russia and China: Energy Relations and International Politics

    Russia and China are neighbors with complementary needs: Russia has an abundance of energy resources, which China needs to fuel its industry. The case analyzes the evolution of the China-Russia energy relations in the post-Cold War period, with an emphasis on the political factors, external and domestic, impeding and contributing to the full realization of the potential of energy ties between Russia and China.

    Keywords: Strategy; International Relations; Energy; Cross-Cultural and Cross-Border Issues; Globalized Markets and Industries; Business and Government Relations; Energy Industry; China; Russia;

    Citation:

    Abdelal, Rawi, and Sogomon Tarontsi. "Russia and China: Energy Relations and International Politics." Harvard Business School Case 713-045, October 2012. (Revised August 2013.)
  5. Doing Business in South Africa

    Keywords: South Africa;

    Citation:

    Abdelal, Rawi, Catherine S. M. Duggan, and Ian McKown Cornell. "Doing Business in South Africa." Harvard Business School Case 713-024, September 2012. (Revised September 2013.)
  6. Natural Gas

    In an overview of natural gas as a fossil fuel and traded commodity, the case describes various regional markets of natural gas, highlighting diversity of price formation mechanisms across and within those markets. Recent changes in the economics of unconventional natural gas extraction—"the shale revolution"—could potentially remake those markets, steering the world toward the "golden age" of natural gas.

    Keywords: Markets; Strategy; Energy Sources; Energy Industry; Mining Industry;

    Citation:

    Abdelal, Rawi, and Sogomon Tarontsi. "Natural Gas." Harvard Business School Case 713-020, September 2012.
  7. Latvia: Navigating the Strait of Messina

    This case describes Latvia's transition from a Soviet republic into an EU member, its economic boom and subsequent bust in 2008, and its policy response. After implementing significant economic and political reforms in order to qualify for EU membership in 2004, Latvia had turned its sights toward joining the single-currency eurozone, pegging its currency to the euro in 2005 as a step toward that goal. From 2000 to 2007, Latvia achieved faster GDP growth than any EU state. However, when large inflows of capital suddenly dried up in 2008, Latvia had to obtain a financial rescue package from the IMF, World Bank, EU, and several regional countries in order to avoid a full-blown financial and currency crisis. Latvia then adopted an aggressive economic adjustment program centered on maintaining its currency peg, which meant competitiveness would have to be restored by reducing domestic prices, wages, and public expenditures in order to drive down the real exchange rate. Latvia's policy program and initial results are discussed in the case.

    Keywords: Currency Exchange Rate; Competitive Strategy; Economic Growth; Policy; Financial Crisis; Economic Slowdown and Stagnation; Latvia;

    Citation:

    Di Tella, Rafael, Rawi Abdelal, and Natalie Kindred. "Latvia: Navigating the Strait of Messina." Harvard Business School Case 711-053, April 2011. (Revised July 2012.)
  8. Energy Security in Europe (A): Nord Stream

    Russian and German energy firms initiated the Nord Stream natural gas pipeline project with strong political support from their home governments but encountered resistance from other states. Although the pipeline would connect Russia with Germany directly, the project was not simply a bilateral matter. First, a need to secure construction permits in multiple jurisdictions around the Baltic Sea involved other countries. And second, Germany's membership in the European Union entailed compliance with goals and values of the entire union, which stressed the imperative of collective action in energy matters and dangers of succumbing to "national reflexes." Thus the implications of the project became a matter of concern to the entire European Union but Europeans struggled to articulate the meaning of Nord Stream: was it a "separate peace" between Russia and Germany to the detriment of the rest, or was it a pan-European deal to the benefit of all? As the case chronicles, the success of Nord Stream depended on the ability of its creators to ensure that latter view prevailed over the former.

    Keywords: Non-Renewable Energy; Leadership; Distribution; Business and Government Relations; Conflict and Resolution; Energy Industry; Russia; European Union; Germany;

    Citation:

    Abdelal, Rawi E., and Sogomon Tarontsi. "Energy Security in Europe (A): Nord Stream." Harvard Business School Case 711-026, November 2010. (Revised February 2013.)
  9. Energy Security in Europe (B): The Southern Corridor

    Nabucco natural gas pipeline, initiated by a group of European energy companies, was intended to connect the broad gas-rich region of the Middle East and Central Asia to Europe for the first time, which would diversify supply sources. At the same time, an Italian-Russian consortium announced South Stream natural gas pipeline, which would diversify transport routes for the delivery of Russian gas to Europe. To win support, backers of Nabucco and South Stream insisted that their projects were aimed at fulfilling goals of the energy policy of the EU (reduction of use of fossil fuels to combat climate change and guaranteed physical availability and affordability of imported fossil fuels). But, as the case demonstrates, both projects progressed slowly, encountering many technological and commercial challenges, which, however, were eclipsed by the extreme politicization of Nabucco and South Stream: pipelines became a factor in domestic politics of several European nations and figured prominently in relations between the EU, EU states, Russia, Turkey, former Soviet republics in Caucasus and Central Asia, and the United States. Although they would comprise only a small part in the overall architecture of Europe's energy security, the case of Nabucco and South Stream reveals the limits of the ambitious energy policy of the EU.

    Keywords: Non-Renewable Energy; Governing Rules, Regulations, and Reforms; Policy; Distribution; Business and Government Relations; Conflict and Resolution; Energy Industry; Russia; European Union;

    Citation:

    Abdelal, Rawi E., and Sogomon Tarontsi. "Energy Security in Europe (B): The Southern Corridor." Harvard Business School Supplement 711-033, November 2010. (Revised February 2013.)
  10. Mubadala: Forging Development in Abu Dhabi

    In 2007, Khaldoon Khalifa Al Mubarak, the CEO of Mubadala Development Company (Mubadala), had every reason to be optimistic about the future of his home, Abu Dhabi, one of the emirates comprising the United Arab Emirates (UAE). The tiny, sandy, and dry emirate with a population of 1.5 million, only 420,000 of whom were citizens, was nestled upon nearly 10% of the world's known reserves of oil and the 4th largest proven reserve of natural gas. With the price of oil doubling every 10 years between 1970 and the 2000s, the state-owned Abu Dhabi National Oil Company (ADNOC) had enjoyed an era of increasing profitability. Another state-owned firm, Abu Dhabi Investment Authority (ADIA), had been investing extra oil revenues outside of the county for more than 30 years, and the intensely secretive organization had amassed assets worth an astonishing—and still rapidly growing—$500 billion to $900 billion. A common refrain held that Abu Dhabi nationals could live off of the returns generated by ADIA forever. Some accordingly referred to the emirate as "the richest city in the world." Yet Al Mubarak, trusted advisor to the crown prince Mohamed bin Zayed Al Nahayan, and Mubadala were charged with transforming the economy of the emirate. Many were concerned that Abu Dhabi was in danger of suffering from the so-called "resource curse," as its economy focused on fossil fuels and little else. Not only would Abu Dhabi's economy continue to be subjected to the vagaries of world energy prices, there would be little for its citizens to do. Not everyone could work for ADNOC or ADIA. Not everyone was from one of Abu Dhabi's handful of incredibly wealthy families. To be a developed country, Abu Dhabi needed change. Fortune had already played perhaps too large a role.

    Keywords: Development Economics; Economy; Non-Renewable Energy; Globalization; Leading Change; State Ownership; Diversification; Abu Dhabi;

    Citation:

    Abdelal, Rawi E., and Irina Tarsis. "Mubadala: Forging Development in Abu Dhabi." Harvard Business School Case 708-033, November 2007. (Revised March 2011.)
  11. Enel: Power, Russia, and Global Markets

    Although the global trend toward liberalization of electric utilities forced Enel, the largest power company in Italy, to give up some of its assets in its home base, it also opened up many opportunities abroad, including in Russia, one of the largest electricity markets in the world. The case outlines Enel's internationalization strategy and then focuses on one piece of the company's strategic puzzle of global expansion: acquisition of major power-generation assets in the course of the break-up of RAO UES, the Russian electricity monopoly. The case highlights the decision-making process by the company executives in the context of possible political risks to foreign investment in Russian strategic industries and economic risks to investment in the yet-to-be-formed liberalized and deregulated electricity market in Russia.

    Keywords: Mergers and Acquisitions; Energy Generation; Foreign Direct Investment; Global Strategy; Globalized Firms and Management; Globalized Markets and Industries; Business and Government Relations; Utilities Industry; Russia; Italy;

    Citation:

    Abdelal, Rawi E., Richard H.K. Vietor, and Sogomon Tarontsi. "Enel: Power, Russia, and Global Markets." Harvard Business School Case 709-046, May 2009. (Revised January 2011.)
  12. Crisis and Reform in Japan's Banking System (A)

    In 1997, amidst Japan's ongoing financial problems, Prime Minister Ryutaro Hashimoto sought to restructure the financial sector to make it more transparent and globally competitive. He hoped that this effort, dubbed the "Big Bang" after the British financial restructuring a decade earlier, would prove as successful. But the financial problems, which seemed to have abated, looked as if they might be worsening. Thus, Hashimoto had to weigh priorities. Should he focus on long-term restructuring, immediate financial rescue, or both? Might an over-emphasis on long-term restructuring increase the chances that major banks could collapse? And what were the best economic and political strategies in these arenas? As a major developed economy, Japan offers an analog to the problems that faced the United States in its 2008–2009 financial crisis.

    Keywords: Financial Crisis; Capital; Banks and Banking; Crisis Management; Business and Government Relations; Banking Industry; Japan;

    Citation:

    Porte, Thierry, Rawi E. Abdelal, Laura Alfaro, and Jonathan Schlefer. "Crisis and Reform in Japan's Banking System (A)." Harvard Business School Case 710-036, November 2009. (Revised June 2012.)
  13. European Financial Integration

    Provides background on the history and status of financial integration in the European Union. Describes the pertinent treaty-based "fundamental freedoms," emphasizes challenges to further cross-border consolidation in the banking sector, and examines the regulatory role of the European Commission in fostering conditions conducive to further financial integration.

    Keywords: Banks and Banking; Financial Markets; Financial Strategy; Cross-Cultural and Cross-Border Issues; Governing Rules, Regulations, and Reforms; Integration; Banking Industry; European Union;

    Citation:

    Abdelal, Rawi E., and Christopher Bruner. "European Financial Integration." Harvard Business School Background Note 706-010, August 2005. (Revised October 2010.)
  14. Russia: Revolution and Reform

    The collapse of central authority in the Soviet Union in 1991 ushered in a period of revolutionary transformations for the states that emerged in its wake. The leaders of Russia, the USSR's successor, since then have struggled to reestablish central authority while seeking to avoid further disintegration, establish a democratic polity, and institute a market economy. The case contrasts different approaches adopted by Presidents Boris Yeltsin and Vladimir Putin and concludes with a vision outlined by Russia's third post-Soviet president, Dmitry Medvedev. The case focuses on problems of state authority, fiscal capacity, institutionalization of political parties, relations between the federal center and provincial governments, relations between the state and big business, economic policy, and models of economic development.

    Keywords: Development Economics; Economic Systems; Government Administration; Business and Government Relations; Public Administration Industry; Russia;

    Citation:

    Abdelal, Rawi E., and Sogomon Tarontsi. "Russia: Revolution and Reform." Harvard Business School Case 710-030, March 2010. (Revised August 2010.)
  15. Crisis and Reform in Japan's Banking System (B)

    In 1997, amidst Japan's ongoing financial problems, Prime Minister Ryutaro Hashimoto sought to restructure the financial sector to make it more transparent and globally competitive. He hoped that this effort, dubbed the "Big Bang" after the British financial restructuring of a decade earlier, would prove as successful. But the financial problems, which seemed to have abated, looked as if they might be worsening. Thus, Hashimoto had to weigh priorities. Should he focus on long-term restructuring, immediate financial rescue, or both? Might an over-emphasis on long-term restructuring increase the chances that major banks could collapse? And what were the best economic and political strategies in these arenas? As a major developed economy, Japan offers an analog to the problems that faced the United States in its 2008-09 financial crisis.

    Keywords: History; Adaptation; Policy; Globalized Markets and Industries; Financial Crisis; Business and Government Relations; Macroeconomics; Restructuring; Global Strategy; Banks and Banking; Banking Industry; Japan;

    Citation:

    Porte, Thierry, Rawi E. Abdelal, Laura Alfaro, and Jonathan Schlefer. "Crisis and Reform in Japan's Banking System (B)." Harvard Business School Supplement 710-037, November 2009. (Revised June 2012.)
  16. Gazprom (A): Energy and Strategy in Russian History

    Critics have accused Gazprom, the world's largest natural gas producer, of eschewing market principles in favor of the foreign policy priorities of the Russian government, ever since the energy giant cut off the supply to Ukraine in January of 2006. The purported motive for the decision, however, seems to indicate the opposite: the company claimed that it had no other choice because the sides failed to conclude a contract on the terms of future trade. The case takes a look back in history for clues that may resolve this paradox. It highlights how politics shaped the economics of natural gas trade in the former Soviet Union and Europe since the late 1960s until the end of the 1990s; sketches the story of the creation of Gazprom by the first post-Soviet government of Russia; and describes how the erection of new sovereign borders in the wake of the dissolution of the Soviet Union, coupled with political and economic transition, created major problems in the gas trade between the former Soviet republics, emerging with the greatest intensity in the Russian-Ukrainian relations.

    Keywords: History; International Relations; Trade; Energy Industry; Russia; Soviet Union; Ukraine; Europe;

    Citation:

    Abdelal, Rawi E., Sogomon Tarontsi, and Alexander Jorov. "Gazprom (A): Energy and Strategy in Russian History." Harvard Business School Case 709-008, August 2008. (Revised July 2009.)
  17. Gazprom (B): Energy and Strategy in a New Era

    President Putin publicly stated that Gazprom, the largest natural gas producer in the world, was a powerful political lever of the Russian state in the world and a keystone in the foundation of the country's energy security. Thus the top leadership of Russia has charted the course of the company's future away from the seemingly imminent dismemberment, privatization, and, by implication, de-monopolization toward a challenging combination of strengthened state control, professional, transparent management, and a major expansion. The case explores how in 2000–2008 Gazprom's management has pursued the strategy defined by the politicians. Gazprom's impressive expansion strategy envisioned diversification of markets, products, transportation routes, and modes of delivery. The challenges were equally formidable: massive investment needs, a possibility of a production shortfall, and a chronic problem with the transit state of Ukraine, to name a few. In fact, Gazprom's ambitiousness fully reflected the ambitiousness of Russia as a whole, characteristic of the Putin era.

    Keywords: Non-Renewable Energy; Growth and Development Strategy; State Ownership; Business and Government Relations; Expansion; Energy Industry; Russia; Ukraine;

    Citation:

    Abdelal, Rawi E., Sogomon Tarontsi, and Alexander Jorov. "Gazprom (B): Energy and Strategy in a New Era." Harvard Business School Supplement 709-009, August 2008. (Revised July 2009.)
  18. Gazprom (C): The Ukrainian Crisis and Its Aftermath

    The case describes the resolution to the January 2006 gas crisis, precipitated by the decision of Gazprom, the largest natural gas producer in the world, to cut off gas supply to Ukraine because of disagreement on the terms of future trade. The case also narrates the events that have followed: the adoption by Gazprom of a comprehensive policy to renegotiate prices with the rest of the former Soviet states; the erratic relationship with Ukraine, dependent on the internal political configuration in the latter at any given time; and a persistence of Gazprom's negative image in the world.

    Keywords: Trade; Non-Renewable Energy; Cross-Cultural and Cross-Border Issues; Governing Rules, Regulations, and Reforms; Conflict Management; Reputation; Energy Industry; Russia; Ukraine;

    Citation:

    Abdelal, Rawi E., Sogomon Tarontsi, and Alexander Jorov. "Gazprom (C): The Ukrainian Crisis and Its Aftermath." Harvard Business School Supplement 709-010, August 2008. (Revised July 2009.)
  19. Eliot Spitzer: Pushing Wall Street to Reform

    New York State Attorney General Eliot Spitzer faced a decision about how to stop wrongdoing committed by major Wall Street firms during the Internet boom. The equities analysts of Merrill Lynch and other Wall Street firms were charged with objectively advising retail investors whether to buy or sell publicly traded stock. The analysts had rated some stock a strong buy, while at the same time disparaging it in Internet emails as "a piece of junk" or a "powder keg." Spitzer concluded that the analysts sometimes issued such buy ratings on stock of companies because of a conflict of interest: the Wall Street firms the analysts worked for were making handsome fees for underwriting the companies' stock offerings and providing other services. The usual procedure when an enforcement agency such as the Federal Securities and Exchange Commission (SEC) discovered such a situation would be to complete its investigation and negotiate a resolution privately with the financial firm. If it could not resolve the matter, the agency would formally file suit against the firm in court. This option was open to Spitzer, but the 1921 New York statue gave him an alternative. Even before filing suit in court--and while continuing to investigate the firm further--he could broadcast his findings to warn the public and brand the firm with wrongdoing. This case investigates the decision Spitzer made, and its long-term implications for U.S. financial regulation and financial industries.

    Keywords: Crime and Corruption; Decisions; Financial Institutions; Stocks; Governing Rules, Regulations, and Reforms; Laws and Statutes; Lawsuits and Litigation; Conflict of Interests; Internet; Financial Services Industry; United States;

    Citation:

    Abdelal, Rawi, Rafael Di Tella, and Jonathan Schlefer. "Eliot Spitzer: Pushing Wall Street to Reform." Harvard Business School Case 708-019, March 2008. (Revised April 2009.)
  20. Londolozi: Towards a Sustainable Business Model and Ecological Integrity in Southern Africa

    The Londolozi game viewing reserve in South Africa became a defining icon of ecotourism during the 1990s and early 2000s-that is, a tourist business promoting ecological land management and, at the same time, local economic development. The reserve was in a region in the northeastern part of the country, not far from Mozambique, that sorely called out for progress in both these dimensions. The Sabi Sand Game reserve (within which Londolozi was located) was initially created by the government to provide hunters with an area in which to hunt wildlife. The government retained a portion of the reserve as the Kruger National Park, which allowed visitors to view wildlife, but banned hunting, in an effort to boost wildlife populations. The KNP was initially fenced off from the Sabi Sands Game reserve to prevent hunters from moving into the wildlife reserve. The fence, however, also prevented traditional east-west migration of animals across the region. Through the 1980s and 1990s, the farms within the Sabi Sand Game reserve converted their functions from hunting to wildlife viewing, and the fence was taken down. The new challenge for the farms while transforming into wildlife viewing became land management and local economic development.

    Keywords: Developing Countries and Economies; Organizational Change and Adaptation; Business and Community Relations; Business and Government Relations; Environmental Sustainability; Tourism Industry; South Africa;

    Citation:

    Abdelal, Rawi E., and Thomas Koelble. "Londolozi: Towards a Sustainable Business Model and Ecological Integrity in Southern Africa." Harvard Business School Case 709-001, July 2008. (Revised January 2009.)
  21. Corruption in Germany

    Why do managers become corrupt? Does corruption ever pay? When do friendly relations cross into bribery? How can CEOs manage and prevent outbreaks of corruption? These and other questions are raised by three short case studies of corruption in Germany: at the global engineering firm Siemens, the automaker VW, and the chemical giant BASF. While German law not only permitted overseas bribery but even made it tax deductible until 1999, it was not welcomed in some nations where Siemens did business such as the United States-or in Germany after 2000-but old practices continued. Cooperative management-labor relations, often seen as key to the post-World War II German industrial powerhouse, went sour at VW, as a top manager secured key concessions by paying for union leaders' lavish foreign travel and visits to prostitutes. After vitamin prices sagged in the late 1980s, BASF and the Swiss chemical firm Hoffmann-La Roche plotted a global cartel that lasted a decade and raised the prices of many vitamins 50 percent or more. In the end, even after record criminal fines and jail time for some executives, some observers argued, such practices were likely to recur.

    Keywords: Crime and Corruption; Law; Managerial Roles; Practice; Conflict of Interests; Germany;

    Citation:

    Abdelal, Rawi E., Rafael Di Tella, and Jonathan Schlefer. "Corruption in Germany." Harvard Business School Case 709-006, July 2008. (Revised June 2012.)
  22. Bohemian Crowns: Ceskoslovenska Obchodni Banka (C)

    Keywords: Banks and Banking; Czech Republic;

    Citation:

    Abdelal, Rawi, Daniela Beyersdorfer, and Ane Damgaard Jensen. "Bohemian Crowns: Ceskoslovenska Obchodni Banka (C)." Harvard Business School Supplement 708-029, October 2007. (Revised August 2013.)
  23. Politics and Prudential Supervision: ABN Amro's Bid for Antonveneta (TN) (A) & (B)

    Teaching note to 706-009, 706-039, and 706-010.

    Keywords: Financial Services Industry; European Union; Italy;

    Citation:

    Abdelal, Rawi E. "Politics and Prudential Supervision: ABN Amro's Bid for Antonveneta (TN) (A) & (B)." Harvard Business School Teaching Note 707-036, March 2007.
  24. Journey to Sakhalin: Royal Dutch/Shell in Russia (TN) (A), (B), & (C)

    Keywords: Energy Industry; Russia;

    Citation:

    Abdelal, Rawi E. "Journey to Sakhalin: Royal Dutch/Shell in Russia (TN) (A), (B), & (C)." Harvard Business School Teaching Note 706-067, June 2006. (Revised March 2007.)
  25. Politics and Prudential Supervision: ABN Amro's Bid for Antonveneta (B)

    Keywords: Investment Funds; Banking Industry;

    Citation:

    Abdelal, Rawi E., and Christopher Bruner. "Politics and Prudential Supervision: ABN Amro's Bid for Antonveneta (B)." Harvard Business School Supplement 706-039, January 2006. (Revised March 2007.)
  26. Politics and Prudential Supervision: ABN Amro's Bid for Antonveneta (A)

    Involves the March 2005 takeover bid launched by ABN Amro, the Dutch bank, for Padua-based Banca Antoniana Popolare Veneta S.p.A. (Antonveneta)--a bid that many would view as a test of Italy's commitment to the creation of a single European market for financial services, as well as the openness of the Italian retail banking market. Provides background on European financial integration and developments in the Italian banking market over recent decades, describes events surrounding ABM Amro's bid and the emergence of a competing bid by a much smaller Italian rival, and the role of the Bank of Italy in determining the fate of Antonveneta.

    Keywords: History; Transformation; Business and Government Relations; Integration; Competitive Strategy; Mergers and Acquisitions; Emerging Markets; Financial Markets; Banks and Banking; Financial Services Industry; European Union; Italy;

    Citation:

    Abdelal, Rawi E., and Christopher Bruner. "Politics and Prudential Supervision: ABN Amro's Bid for Antonveneta (A)." Harvard Business School Case 706-009, August 2005. (Revised March 2007.)
  27. The International Financial Architecture

    The International Financial Architecture is one of the core modules of Managing International Trade and Investment, an elective course at Harvard Business School. Provides instructors with an overview of the module, the cases and readings, and the teaching notes.

    Keywords: International Finance;

    Citation:

    Abdelal, Rawi E. "The International Financial Architecture." Harvard Business School Module Note 707-035, February 2007. (Revised February 2007.)
  28. Journey to Sakhalin: Royal Dutch/Shell in Russia (C)

    Keywords: Energy; Energy Industry; Russia;

    Citation:

    Abdelal, Rawi E., and Marina Vandamme. "Journey to Sakhalin: Royal Dutch/Shell in Russia (C)." Harvard Business School Supplement 707-038, February 2007.
  29. Journey to Sakhalin: Royal Dutch/Shell in Russia (B)

    Keywords: Energy Industry; Russia;

    Citation:

    Abdelal, Rawi E., and Irina Tarsis. "Journey to Sakhalin: Royal Dutch/Shell in Russia (B)." Harvard Business School Supplement 706-013, October 2005. (Revised February 2007.)
  30. Private Capital and Public Policy: Standard & Poor's Sovereign Credit Ratings (TN)

    Keywords: Public Sector; Credit; Financial Services Industry;

    Citation:

    Abdelal, Rawi E. "Private Capital and Public Policy: Standard & Poor's Sovereign Credit Ratings (TN)." Harvard Business School Teaching Note 706-070, June 2006. (Revised February 2007.)
  31. Chrysanthemum and Dragon: JAFCO Asia in China (TN)

    Keywords: Asia; China;

    Citation:

    Abdelal, Rawi E. "Chrysanthemum and Dragon: JAFCO Asia in China (TN)." Harvard Business School Teaching Note 706-069, June 2006. (Revised February 2007.)
  32. Bohemian Crowns: Ceskoslovenska Obchodni Banka (TN) (A) & (B)

    Keywords: Banking Industry; Czech Republic;

    Citation:

    Abdelal, Rawi E. "Bohemian Crowns: Ceskoslovenska Obchodni Banka (TN) (A) & (B)." Harvard Business School Teaching Note 706-068, June 2006. (Revised February 2007.)
  33. The Market and the Mountain Kingdom: Change in Lesotho's Textile Industry (TN)

    Teaching Note to 706043.

    Keywords: Markets; Apparel and Accessories Industry; Lesotho;

    Citation:

    Abdelal, Rawi E., Regina M. Abrami, Noel Maurer, and Aldo Musacchio. "The Market and the Mountain Kingdom: Change in Lesotho's Textile Industry (TN)." Harvard Business School Teaching Note 707-003, July 2006. (Revised February 2007.)
  34. Infosys in India: Building a Software Giant in a Corrupt Environment

    Shortly after Infosys was founded in 1981, its managers faced a major turning point when they made a decision to operate without giving in to the petty corruption rife in the Indian economy. Within just a few years, that decision had truly defined the company. Over the next 25 years, Infosys managers went to extraordinary lengths to avoid even the most modest of practices that they considered inappropriate. Explores the practices and methods that Infosys adopted instead, considers their costs, benefits, and generalizability, and contextualizes the problem within Indian political and economic institutions that continue to evolve.

    Keywords: History; Management Style; Moral Sensibility; Policy; Business and Government Relations; Decisions; Business Growth and Maturation; Situation or Environment; Crime and Corruption; Business Strategy; Information Technology Industry; Computer Industry; India;

    Citation:

    Abdelal, Rawi E., Rafael M. Di Tella, and Prabakar (PK) Kothandaraman. "Infosys in India: Building a Software Giant in a Corrupt Environment." Harvard Business School Case 707-030, December 2006. (Revised January 2007.)
  35. The Market and the Mountain Kingdom: Change in Lesotho's Textile Industry

    In Maseru, the capital of the Kingdom of Lesotho, the stirrings of industrialization and modernization were promising, and more than 50,000 workers, mostly women, were employed in the textile sector; the figure reflected more than a threefold increase in just a few years. Just outside Maseru, however, life was pastoral. Of Lesotho's 1.9 million citizens, 86% were engaged in subsistence agriculture. The country's hopes for progress rested with the jobs created by Taiwanese and Chinese firms. In early 2006, however, the survival of the nascent industry hung in the balance. The appreciation of Lesotho's currency, the loti, made life difficult for the apparel firm, which exported almost all of their production to the United States. Although the firms enjoyed duty-free access to an otherwise protected U.S. clothing market through the African Growth and Opportunity Act, the provisions that most benefited Lesotho would expire in 2007. A few large buyers would be making sourcing decisions that could make or break Lesotho's industry. Local union leaders were upset with the government's handling of the textile boom and its putatively impending bust. Certainly the government would play an important role in formulating a strategy and adjusting the institutional context, but decisions made by the unions, foreign investors, foreign buyers, and the American government would also be critical. How would posterity judge Lesotho's first encounter with world markets--as a triumph or a disaster?

    Keywords: History; Labor Unions; Trade; Business and Stakeholder Relations; Financial Crisis; Globalized Markets and Industries; Business and Government Relations; Decision Choices and Conditions; Foreign Direct Investment; Developing Countries and Economies; Fashion Industry; Apparel and Accessories Industry; Lesotho;

    Citation:

    Abdelal, Rawi E., Regina M. Abrami, Noel Maurer, and Aldo Musacchio. "The Market and the Mountain Kingdom: Change in Lesotho's Textile Industry." Harvard Business School Case 706-043, March 2006. (Revised November 2006.)
  36. Chrysanthemum and Dragon: JAFCO Asia in China

    In the autumn of 2002, JAFCO Asia, a subsidiary of JAFCO Co., Ltd., became the first foreign private equity firm to open an office in Beijing's Haidian Science Park. JAFCO was the only Japanese private equity firm operating in China. As such, Managing Director Vincent Chan observed, "JAFCO is the bridge between Japan and China." Yet, under that bridge the waters appeared increasingly choppy. While the economic relationship between Japan and China had grown increasingly close, their political relations had not and some Japanese firms had begun to reassess their commitment to China. Would capital-rich Japan and capital-poor China find a way to transcend their troubled history? Could JAFCO Asia be a catalyst for cooperation, or would its managers find their own operations affected by rivalry between Asia's two most important countries? The mix of formal rules and informal practices that governed foreign private equity firms in China was complex. Opening an office in Beijing signified a renewal of JAFCO Asia's efforts to master these challenges and coincided with an acceleration of the firm's investments. But JAFCO's first years of engagement with China had not been notably successful, and without some fundamental changes, there was little reason to believe that the addition of a physical presence there would yield better results now.

    Keywords: History; International Relations; Business and Shareholder Relations; Business and Government Relations; Expansion; Market Entry and Exit; Performance Effectiveness; Foreign Direct Investment; Business Strategy; Financial Services Industry; China; Beijing; Japan;

    Citation:

    Abdelal, Rawi E., and David Lane. "Chrysanthemum and Dragon: JAFCO Asia in China." Harvard Business School Case 706-012, April 2006. (Revised October 2006.)
  37. Journey to Sakhalin: Royal Dutch/Shell in Russia (A)

    Operations of Royal Dutch/Shell in Russia included a strategic alliance with Gazprom, the country's natural gas monopoly, the development of the Salym oil fields in Siberia, and a small retail refilling network in St. Petersburg. Focuses on the Sakhalin II project. Sakhalin II is the reason for the existence of the Sakhalin Energy Investment Co. (SEIC), owned by Royal Dutch/Shell (55%), Mitsui (25%), and Mitsubishi (20%). Worth approximately $10 billion, the second phase of Sakhalin II would be the single largest investment decision in the history of Royal Dutch/Shell, as well as the single largest foreign direct investment in Russia's history. Sakhalin II would also be the largest integrated oil and gas project in the world. The project, however, faces a number of challenges, however. A production sharing agreement (PSA)--a commercial contract between the foreign investor and a host government that replaces the country's tax and license regimes for the life of the project--governs Sakhalin II. Although Sakhalin II's PSA enjoys the status of Russian law, other Russian laws conflict with the terms of the PSA. PSAs have also become controversial within Russia. After several years of waiting in vain for "legal stabilization," Shell and SEIC executives must decide whether the project should go forward.

    Keywords: Decision Making; Energy Generation; Foreign Direct Investment; Lawfulness; Agreements and Arrangements; Alliances; Business and Government Relations; Energy Industry; Russia;

    Citation:

    Abdelal, Rawi E. "Journey to Sakhalin: Royal Dutch/Shell in Russia (A)." Harvard Business School Case 704-040, March 2004. (Revised June 2006.)
  38. Bohemian Crowns: Ceskoslovenska Obchodni Banka (A)

    Tells the story of the Czech transition from a centrally planned to a free market economy, describing the first economic reforms, the fixed-exchange rate regime, and the voucher privatization. Also explains why, in the middle of the 1990s, the Czech Republic liberalized its capital account and how this affected the Czech banking system, leading to a massive credit boom. Explores why Ceskoslovenska Obchodni Banka (CSOB), the country's fourth largest bank, decided not to participate in the credit boom and how CSOB determined and pursued its expansion strategy. Students assume the position of Pavel Kavanek, CSOB's CEO who, in June 2000, must decide whether CSOB should acquire IPB, another large Czech bank on the brink of bankruptcy.

    Keywords: History; Currency Exchange Rate; Credit; Government Administration; Decisions; Economic Systems; Expansion; Mergers and Acquisitions; Developing Countries and Economies; Banks and Banking; Banking Industry; Czech Republic;

    Citation:

    Abdelal, Rawi E., Vincent Dessain, and Monika Stachowiak. "Bohemian Crowns: Ceskoslovenska Obchodni Banka (A)." Harvard Business School Case 705-007, September 2004. (Revised May 2006.)
  39. Bohemian Crowns: Ceskoslovenska Obchodni Banka (B)

    Supplements the (A) case.

    Keywords: Banking Industry; Czech Republic;

    Citation:

    Abdelal, Rawi E., Vincent Dessain, and Monika Stachowiak. "Bohemian Crowns: Ceskoslovenska Obchodni Banka (B)." Harvard Business School Supplement 705-008, September 2004. (Revised May 2006.)
  40. Democracy

    Surveys scholarship on democracy and democratization. Describes the relationship between democracy and the environment of business, including capitalist economic institutions, economic growth, economic reform, and international relations.

    Keywords: Economic Systems; Situation or Environment; Business and Government Relations; Economic Growth; International Relations; Governing Rules, Regulations, and Reforms;

    Citation:

    Abdelal, Rawi E. "Democracy." Harvard Business School Background Note 702-036, January 2002. (Revised March 2006.)
  41. Standard & Poor's Sovereign Credit Ratings: Scales and Process

    Describes Standard & Poor's sovereign credit ratings scales and the credit rating process. In particular, describes the role and function of the rating committee and the analytical categories considered in arriving at a final sovereign credit rating.

    Keywords: Financial Markets; Credit; Bonds; Policy; Risk and Uncertainty; Measurement and Metrics; Forecasting and Prediction; Financial Services Industry;

    Citation:

    Abdelal, Rawi E., and Christopher Bruner. "Standard & Poor's Sovereign Credit Ratings: Scales and Process." Harvard Business School Background Note 705-027, January 2005. (Revised October 2005.)
  42. Private Capital and Public Policy: Standard & Poor's Sovereign Credit Ratings

    Describes Standard & Poor's sovereign credit ratings business. Provides background on the history of credit ratings agencies, the meaning of credit ratings, the expansion of the sovereign ratings business over recent decades, and the market for credit ratings. Also, discusses current debates in the United States and elsewhere relating to the use of credit ratings in financial and prudential regulation.

    Keywords: Sovereign Finance; History; Policy; Business and Government Relations; International Finance; Country; Globalized Economies and Regions; Decision Choices and Conditions; Capital Markets; Debates; Financial Services Industry; United States;

    Citation:

    Abdelal, Rawi E., and Christopher Bruner. "Private Capital and Public Policy: Standard & Poor's Sovereign Credit Ratings." Harvard Business School Case 705-026, January 2005. (Revised October 2005.)
  43. A Wider Europe: The Challenge of EU Enlargement

    By 2002, the euphoria that accompanied the grandest achievement to date of Europe's 50-plus years of integration--full monetary union--was fading fast. European policy makers completed the historically unprecedented monetary integration of 12 countries, and then they turned their attention to an equally challenging issue: enlarging the European Union (EU). By the beginning of the 21st century, 13 countries clamored for membership in this most exclusive club of rich, democratic, European states. With so many prospective members knocking on the door, European policy makers were forced to decide quickly whom to let in and under what conditions.

    Keywords: History; Cost vs Benefits; Expansion; Decision Choices and Conditions; Problems and Challenges; European Union; Europe;

    Citation:

    Abdelal, Rawi E., and Kimberly A. Haddad. "A Wider Europe: The Challenge of EU Enlargement." Harvard Business School Case 703-021, December 2002. (Revised June 2003.)
  44. Bombardier: Canada versus Brazil at the WTO

    In less than a decade, Bombardier had grown from a medium-size Canadian company to a highly profitable global player largely on the strength of the introduction of a new generation of regional jet and successfully marketing its product to airlines around the world. Events taking place on the other side of the globe, however, threatened Bombardier's hard-earned success. A nasty trade dispute with Brazilian rival Embraer was dragging on into its fifth year with no end in sight. Recent developments in the dispute at the WTO were forcing CEO Robert Brown and his team to decide on a strategy for what could very well turn out to be the most critical year in the company's history.

    Keywords: Trade; Global Strategy; Five Forces Framework; Marketing Strategy; Product Launch; Business and Government Relations; Situation or Environment; Competition; Air Transportation Industry; Canada; Brazil;

    Citation:

    Abdelal, Rawi E., Laura Alfaro, and Brett Laschinger. "Bombardier: Canada versus Brazil at the WTO." Harvard Business School Case 703-022, February 2003. (Revised May 2003.)
  45. Malaysia: Capital and Control

    On September 1, 1998, the government of Malaysia imposed currency and capital controls in response to the financial crisis that had swept Asia. The controls sparked an enormous controversy in the world of international finance. Some celebrated the controls for insulating the Malaysian economy from the unstable international financial system. Others criticized the controls for trapping investors and allowing the government to protect the interests of "cronies." This debate also raised the central question about the future of the international financial architecture: What is the appropriate balance between financial market freedom and government discretion in the management of the global economy?

    Keywords: Business and Government Relations; International Finance; Policy; Crisis Management; Balance and Stability; Globalized Economies and Regions; Malaysia;

    Citation:

    Abdelal, Rawi E., and Laura Alfaro. "Malaysia: Capital and Control." Harvard Business School Case 702-040, April 2002. (Revised April 2003.)
  46. Remaking the Rainbow Nation: South Africa 2002

    In April 1994, the world witnessed a political milestone in South Africa. After decades of repression and racial segregation, South Africa's black majority came to power at last, as the African National Congress (ANC), led by the celebrated Nelson Mandela, rode into power with 63% of the vote in the country's first racially inclusive election. Eight years after this electoral victory, however, many South Africans are starting to question the shifting priorities of the ANC. Although the political situation of the country has vastly improved, the economy remains fragile, and some of the ANC's most loyal allies are decrying what they see as a change of faith. Thabo Mbeki, a former political exile who became president in 1999, must now decide what democracy means for South Africa and how best to preserve it.

    Keywords: Development Economics; Race Characteristics; Political Elections; Economic Growth; Business and Government Relations; South Africa;

    Citation:

    Abdelal, Rawi E., Debora L. Spar, and Katherine E. Cousins. "Remaking the Rainbow Nation: South Africa 2002." Harvard Business School Case 702-035, February 2002. (Revised February 2003.)
  47. Remaking the Rainbow Nation: South Africa 2002 (TN)

    Teaching Note for (9-702-035).

    Keywords: South Africa;

    Citation:

    Abdelal, Rawi E., and Debora L. Spar. "Remaking the Rainbow Nation: South Africa 2002 (TN)." Harvard Business School Teaching Note 703-017, October 2002.
  48. Malaysia: Capital and Control (TN)

    Teaching Note for (9-702-040).

    Keywords: Malaysia;

    Citation:

    Abdelal, Rawi E., and Laura Alfaro. "Malaysia: Capital and Control (TN)." Harvard Business School Teaching Note 703-020, October 2002.
  49. Russia: The End of a Time of Troubles? (TN)

    Teaching Note for (9-701-076).

    Keywords: Russia;

    Citation:

    Abdelal, Rawi E. "Russia: The End of a Time of Troubles? (TN)." Harvard Business School Teaching Note 701-078, May 2001. (Revised October 2002.)
  50. Capital Controls

    Only in the waning years of the 20th century did international financial markets begin to enjoy the freedom from government regulation that they had experienced before the first world war. By 2002, international capital markets had grown to be enormous--$1.2 trillion flowed around the globe per day. The massive size of the market presented policy makers with a serious challenge as they were forced to grapple with the costs and benefits of such mobile capital. This note briefly relates the modern history of capital controls and summarizes scholarship on the advantages and disadvantages of international financial market regulation.

    Keywords: History; Policy; Business and Government Relations; Change Management; Cost vs Benefits; Governance Controls; Governance Compliance; Emerging Markets; Financial Markets; Network Effects; Banking Industry; Financial Services Industry;

    Citation:

    Abdelal, Rawi E., and Laura Alfaro. "Capital Controls." Harvard Business School Background Note 702-082, April 2002. (Revised September 2002.)
  51. State, The

    Surveys approaches to understanding the state; highlights the relationships between the state, order, and property; and offers an analytical framework for how states vary from place to place and over time.

    Keywords: Business and Government Relations; Governance Compliance; Framework; Economic Sectors; Policy; Private Ownership; Public Ownership; Entrepreneurship; Development Economics; Equality and Inequality;

    Citation:

    Abdelal, Rawi E. "State, The." Harvard Business School Background Note 701-077, January 2001. (Revised May 2001.)
  52. Russia: The End of a Time of Troubles?

    Describes Russia's troubled economic transition since 1991, highlights the problem of institutional development, and surveys the challenges President Vladimir Putin faced in 2000. The first section provides a brief synopsis of liberalization, stabilization, and privatization under President Boris Yeltsin. The second section describes the economic difficulties Russia experienced during the 1990s involving demonetization, federalism, taxes, contract enforcement, the legal system, the 1998 financial crisis, and public health. Concludes with President Putin's political and economic plans.

    Keywords: Transition; Public Sector; Privatization; Economy; Developing Countries and Economies; Government and Politics; Business and Government Relations; Russia;

    Citation:

    Abdelal, Rawi E. "Russia: The End of a Time of Troubles?" Harvard Business School Case 701-076, January 2001. (Revised May 2001.)