Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
5106972 | International Business Review | 2017 | 11 Pages |
Abstract
This paper examines the impact of sub-national institutions on the performance of foreign firms in China. Building on institutional theory, we envisage that the negative effect of sub-national institutional constraints is moderated by firm size and age, entry mode, and market orientation. Our hypotheses are tested on a large-firm-level dataset of about 29,000 foreign firms in 120 cities in China within the period of 1999-2005. We find that firm size and age both have a diminishing positive impact on foreign firm performance; moreover, there is a U-shaped relationship between firm age and foreign firm performance in cities with higher level institutional constraints. We also find that joint ventures help mitigate the negative impact of sub-national institutional constraints on foreign firm performance when the level of institutional constraints is higher.
Related Topics
Social Sciences and Humanities
Business, Management and Accounting
Business and International Management
Authors
Xiaoying Li, Laixiang Sun,