Contextual status effects: The performance effects of host-country network status and regulatory institutions in cross-border venture capital

Yu Liu and Markku Maula

Research Policy, 2021, vol. 50, issue 5

Abstract: Network status is generally considered to be a valuable firm asset; however, its effects are not well understood in the context of cross-border VC investments, as foreign VC firms can have different statuses in their home and host countries, and prior research has considered only the effects of home-country network status. Theorizing the importance of a foreign VC firm's network status in the host country for cross-border VC investments, we hypothesize a positive performance effect for network status in the host country. Furthermore, we theorize that the performance effect of a VC firm's network status in the host country is stronger in countries with weaker host-country regulatory institutions. We test these hypotheses using a global sample of cross-border VC investments and find support for our arguments.

Keywords: Cross-border venture capital; Status multiplicity; Networks; Institutions (search for similar items in EconPapers)
JEL-codes: G15 G24 M13 M16 Z13 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:respol:v:50:y:2021:i:5:s0048733321000202

DOI: 10.1016/j.respol.2021.104216

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