Home country institutions and the internationalization of state owned enterprises: a cross-country analysis

Saul Estrin, Klaus Meyer, Bo B. Nielsen and Sabina Nielsen

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: National institutions shape the ability of civil society and minority shareholders to monitor and influence decision-makers in listed state owned enterprises (SOEs), and thereby their strategies of internationalization. We argue that the weaker are such controls, the more likely such decision makers pursue self-serving motives, and thus shy away from international investment. Listed SOEs’ strategies will thus be more similar to those of wholly privately owned enterprises (POEs) when these controls are more effective. Building on Williamson's (2000) hierarchy of institutions, we examine how home country institutions exerting normative, regulatory, and governance-related controls affect the comparative internationalization levels of listed SOEs and POEs. Based on a matched sample of 153 majority state owned and 153 wholly privately owned listed firms from 40 different countries, we confirm that, when home country institutions enable effective control, the internationalization strategies of listed SOEs and POEs converge.

Keywords: state owned enterprises; internationalization; home country institution; matched sample; Tobit regression (search for similar items in EconPapers)
JEL-codes: J50 (search for similar items in EconPapers)
Date: 2016-02-01
New Economics Papers: this item is included in nep-int
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Citations: View citations in EconPapers (84)

Published in Journal of World Business, 1, February, 2016, 51(2), pp. 294-307. ISSN: 1090-9516

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Journal Article: Home country institutions and the internationalization of state owned enterprises: A cross-country analysis (2016)
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