An empirical analysis of international operating patterns and competitiveness of United States

The global banking industry has undergone tremendous change during the 1980s and 1990s. Yet there remain major differences among countries regarding (1) the emphasis they place on banks as opposed to capital markets for providing finance to their industries and (2) the level of banking regulations. The existence of different host-country environments raises significant questions for international management scholars and practitioners pertaining to international operating patterns and international competitiveness of banks in different environments.;This dissertation addresses three research questions: (1) to what extent does a host country's environment influence the organizational form preferences of U.S. banks; (2) to what extent does a host country's environment influence the determinants of efficiency of U.S.-owned banks, other foreign-owned banks, and domestic banks; (3) to what extent are there differences in the level of efficiency of U.S.-owned banks and other foreign-owned banks across environments?;The first part of this dissertation examines how U.S. banks structure their international operations in different host-country environments. I use foreign direct investment theory and international organization theory as a basis for hypothesis development. The second part of the dissertation, which addresses questions 2 and 3, examines the competitiveness of U.S.-owned banks compared to other foreign-owned banks and host-country banks. I use the theory of the multinational enterprise and national advantage, along with some financial theory, to develop the hypotheses. The host-country environment serves as the analytical lens through which I examine the international operating patterns and competitiveness of U.S. banks.;Data sources included the Federal Reserve Board, International Financial Statistics, IBCA BankScope database, annual reports and informal interviews with banking executives. Statistical techniques include 2-way ANOVA and logit models. In addition, I used stochastic frontier estimation and distribution-free estimation.;The results for international operating patterns suggest that the host-country environment significantly influences how U.S. banks structure their international operations. Also, the influence of some bank-specific and location-specific factors shifts within different environments. These results underscore the importance of environmental flexibility in optimizing a bank's global competitive advantage. The competitiveness results provide evidence of (1) a liability of foreignness for all foreign-owned banks, (2) a U.S.-home country advantage in some environments, and (3) an advantage for foreign-owned banks from a home-country environment that is similar to the one in the host country. Finally, there is evidence that a bank's "home-country" environment significantly effects the efficiency of a foreign-owned bank.