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Li, Xiaoying and Sun, Laixiang (2017) 'How do sub-national institutional constraints impact foreign firm performance?' International Business Review, 26 (3). pp. 555-565.

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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.

Item Type: Journal Article
SOAS Departments & Centres: Legacy Departments > Faculty of Law and Social Sciences > School of Finance and Management
ISSN: 09695931
DOI (Digital Object Identifier): https://doi.org/10.1016/j.ibusrev.2016.11.004
Date Deposited: 02 Jun 2017 15:09
URI: http://eprints.soas.ac.uk/id/eprint/24203

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