The Interplay of Top-down Institutional Pressures and Bottom-up Responses of Transition Economy Firms on FDI Entry Mode Choices
- Authors
- Chung, Chris Changwha; Xiao, Simon Shufeng; Lee, Jeoung Yul; Kang, Jingoo
- Issue Date
- Oct-2016
- Publisher
- SPRINGER HEIDELBERG
- Keywords
- Institutional pressures; Institutional freedom; Foreign direct investment; Outward international joint ventures; Transition economies; China
- Citation
- MANAGEMENT INTERNATIONAL REVIEW, v.56, no.5, pp.699 - 732
- Journal Title
- MANAGEMENT INTERNATIONAL REVIEW
- Volume
- 56
- Number
- 5
- Start Page
- 699
- End Page
- 732
- URI
- https://scholarworks.bwise.kr/hongik/handle/2020.sw.hongik/7350
- DOI
- 10.1007/s11575-015-0256-5
- ISSN
- 0938-8249
- Abstract
- This study examines the role of institutions in explaining the FDI entry mode choices of transition economy firms. Advancing an institution-based view of international business strategy, the paper proposes a model of interactive institutional processes that incorporates both top-down institutional pressures and the bottom-up heterogeneous responses of individual firms to such pressures. The findings are based on a sample of 594 outward FDI entries made by Chinese firms. The results indicate that institutional pressures exerted by the home country government have a significant effect on outward FDI ownership decisions, such that firms facing greater institutional pressures are more inclined to choose outward international joint ventures (OIJVs) over wholly owned foreign subsidiaries. However, the effect of institutional government pressures on FDI entry mode choices is weaker for firms which are less dependent on the Chinese government for resources and thus enjoy more institutional freedom. Specifically, the ownership structures of Chinese firms moderate the positive effect of home country government pressures on the choice of OIJVs, such that the positive effect is weaker for modernized firms (i.e., newly created private and reformed incorporated firms) than conventional firms (i.e., state-owned enterprises (SOEs) and collectives). The positive effect is weaker for collectives than SOEs, while the positive effect is weaker for private firms than reformed firms (i.e., private firms < reformed firms < collectives < SOEs).
- Files in This Item
- There are no files associated with this item.
- Appears in
Collections - College of Business Management > Global Business Administration Major > 1. Journal Articles
![qrcode](https://api.qrserver.com/v1/create-qr-code/?size=55x55&data=https://scholarworks.bwise.kr/hongik/handle/2020.sw.hongik/7350)
Items in ScholarWorks are protected by copyright, with all rights reserved, unless otherwise indicated.