The Institutionalization of Political Risk Assessment by Chinese Multinational Firms

Ilan Alon, Alfredo Jiménez, Hui Liu and Hua Wang
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Ilan Alon: UIA - University of Agder
Alfredo Jiménez: Kedge BS - Kedge Business School
Hui Liu: ITESM - Tecnológico de Monterrey = Monterrey Institute of Technology
Hua Wang: EM - EMLyon Business School

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Abstract: Some researchers have claimed that Chinese firms are impervious to political risk, call­ing into question the institutionalization of political risk by Chinese firms. Building on resource dependence theory and the literature on non-market strategies, this study finds significant impact by ownership structure, firm scale, and the degree of internationaliz­ation on the institutionalization of political risk assessments (IPRA) by Chinese firms. As such, state-owned firms and larger firms cultivate a higher level of IPRA. We find a positive impact of a firm's scale and scope of internationalization, but insignificant impact of depth of internationalization.L'institutionnalisation de l'évaluation des risques politiques par les entreprises multinationales chinoises. Il est affirmé que les entreprises chinoises étaient insensibles au risque politique, remet­tant en question l'institutionnalisation du risque politique par les entreprises chinoises. S'appuyant sur la théorie de la dépendance des ressources et la littérature sur les stratégies non marchandes, cette étude révèle un impact significatif de la structure de propriété, la taille et le degré d'internationalisation sur l'insti­tutionnalisation des évaluations du risque politique (IPRA). Les entreprises publiques et les grandes entreprises cultivent un niveau plus élevé d'IPRA. Nous constatons un impact positif de la taille et de l'étendue de l'inter­nationalisation, mais un impact insignifiant de la profondeur de l'internationalisation.La institucionalización de la evaluación del riesgo político por las empresas multinacionales chinas. Se ha afirmado que las empresas chinas son inmunes al riesgo político, cuestionando la institucionalización del riesgo político por parte de las empresas chinas. Partiendo de la teoría de la dependencia de recursos y la literatura sobre estrategias no de mercado, encontramos que la estructura de propiedad, el tamaño y el grado de internacionalización influyen en la institucionalización de las eva­luaciones de riesgo político (IPRA). Así, las empresas estatales y las grandes tienen mayor nivel de IPRA. Encontramos un impacto positivo de la escala y el alcance de la interna­cionalización, pero un impacto insignificante de la profundidad de la internacionalización.

Keywords: Chinese MNEs; Non-market Strategy; Political Risk; Political Connections; Resource dependence theory; Stateownership (search for similar items in EconPapers)
Date: 2020-12-01
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Published in Management international = International management = Gestión internacional, 2020, 24, pp.49-63. ⟨10.7202/1077433ar⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-03188244

DOI: 10.7202/1077433ar

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