Internationalization and innovation performance of emerging market enterprises: The role of host-country institutional development

Jie Wu, Chengqi Wang, Junjie Hong, Panagiotis Piperopoulos and Shuaihe Zhuo

Journal of World Business, 2016, vol. 51, issue 2, 251-263

Abstract: We examine how host-country institutional development influences innovation performance of internationalized emerging market enterprises (EMEs). Our panel-data analysis of Chinese EMEs shows that although host-country institutional development on average enhances innovation performance of the parent, such effects are more pronounced for EMEs with strong absorptive capacity and for those diversifying into a larger number of countries. Interestingly, EMEs with a higher level of state ownership gain more when entering countries with a lower level of institutional development. Our findings offer insights regarding how latecomer EMEs should configure their portfolio of subsidiaries in order to enhance innovation performance of their parent.

Keywords: Internationalization; Innovation performance; Institutional environment; Absorptive capacity; State ownership; Geographic diversification (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (98)

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DOI: 10.1016/j.jwb.2015.09.002

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