Overcoming distrust: How state-owned enterprises adapt their foreign entries to institutional pressures abroad
Klaus Meyer,
Yuan Ding,
Jing Li and
Hua Zhang
Additional contact information
Jing Li: Beedie School of Business, Simon Fraser University, Burnaby, Canada
Journal of International Business Studies, 2014, vol. 45, issue 8, 1005-1028
Abstract:
State-owned (SO) enterprises are subject to more complex institutional pressures in host countries than private firms. These institutional pressures arise from a weak legitimacy of “state ownership” in some countries, which arises from a combination of ideological conflicts, perceived threats to national security, and claimed unfair competitive advantage due to support by the home country government. These institutional pressures directed specifically at SO firms induce them to adapt their foreign entry strategies to reduce potential conflicts and to enhance their legitimacy. Testing hypotheses derived from this theoretical argument for subsidiaries of listed Chinese firms, we find that SO firms adapt mode and control decisions differently from private firms to the conditions in host countries, and these differences are larger where pressures for legitimacy on SO firms are stronger. These findings not only extend institutional theory to better explain differential effects on different entrants to an organizational field, but demonstrate how foreign investors of idiosyncratic origins may proactively build legitimacy in host societies.
Date: 2014
References: Add references at CitEc
Citations: View citations in EconPapers (152)
Downloads: (external link)
http://www.palgrave-journals.com/jibs/journal/v45/n8/pdf/jibs201415a.pdf Link to full text PDF (application/pdf)
http://www.palgrave-journals.com/jibs/journal/v45/n8/full/jibs201415a.html Link to full text HTML (text/html)
Access to full text is restricted to subscribers.
Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
HTML/Text
Persistent link: https://EconPapers.repec.org/RePEc:pal:jintbs:v:45:y:2014:i:8:p:1005-1028
Ordering information: This journal article can be ordered from
http://www.springer. ... nt/journal/41267/PS2
Access Statistics for this article
Journal of International Business Studies is currently edited by John Cantwell
More articles in Journal of International Business Studies from Palgrave Macmillan, Academy of International Business
Bibliographic data for series maintained by Sonal Shukla (sonal.shukla@springer.com) and Springer Nature Abstracting and Indexing (indexing@springernature.com).