Concurrent sourcing strategy of multinational firms in China: Drivers and performance implications

Concurrent sourcing is critical to multinational firms’ operations in emerging economies, such as China. Despite its prominence, research is lacking on the underlying conditions and performance implications of this strategy. We investigate the driving factors of multinational firms’ concurrent sourcing strategy and test whether concurrent sourcing outperforms other types of sourcing strategies. Our empirical findings suggest that multinational firms tend to choose concurrent sourcing under high levels of institutional regulations. Furthermore, the results show that concurrent sourcing generates better performance at high levels of uncertainties and the performance deficiency of concurrent sourcing can be mitigated when institutional regulations are high.     

Impact of institutional reforms and industry structural factors on market returns of emerging market rivals during acquisitions by foreign firms

This paper seeks to understand the joint impact of institutional reforms and industry structural factors on market returns earned by rivals in an emerging market during foreign acquisitions. We use a sample of 238 foreign acquisitions in India during the period 2004–2013 and find empirical evidence to support the notion that institutional reforms, foreign competition and business group competition positively impact the market returns of the rivals of acquired firms. Additionally, we find that the effects of foreign competition and business group competition on rivals’ market returns are shaped by the degree of institutional reforms in the industry, indicating that firms’ market returns in emerging markets during foreign acquisitions can be better understood through the incorporation of the joint role of industry structural factors and institutional reforms.     

Industry globalization and the performance of emerging market firms: Evidence from China

In this study, we explore the extent to which industry globalization affects the performance of firms in China, an emerging market. We focus on the period between 1996 and 2001 and track the globalization levels for six different Chinese industries as well as the performance of 166 public listed firms in these industries. The results validate our major premise: high levels of industry globalization positively impact the performance of Chinese firms. We also find that when their industries globalize, firms with slack resources experience greater performance improvement than other firms without these resources.     

Impact of international entry choices on the nature and type of innovation: Evidence from emerging economy firms from the Indian bio-pharmaceutical industry

As emerging economy multinational enterprises (EMNEs) enter foreign countries in search of new markets, seeking to expand their knowledge bases, research on the type and nature of innovation activity is needed to address the impact of EMNEs’ choices related to international expansion. Building on prior literature on entry mode and location choices, as well as on organizational learning, we argue that how and where an EMNE expands internationally will impact the nature of its innovation. We carry out empirical analysis on a sample of 167 Indian bio-pharmaceutical firms for the period from 1997–2017. Our findings suggest that greenfield ventures foster innovation in core technologies, while cross-border mergers and acquisitions (M&As) foster innovation in non-core technologies. In addition, locating subsidiaries in high income countries encourages product innovations, while locating in low income countries encourages process innovations. Our findings contribute to the growing literature on differences in learning outcomes of EMNE internationalization.     

Entrepreneurial orientation and innovation in family SMEs: Unveiling the (actual) impact of the Board of Directors

Drawing on stewardship and resource dependence theories, we examine how the board of directors (BoD) influences the link between entrepreneurial orientation (EO) and ambidextrous innovation in small and medium sized family firms (family SMEs). Our analysis of 230 Spanish family SMEs shows that family involvement in the BoD has a negative effect on their ability to turn EO into innovation. Moreover, we show that the BoD's strategic involvement in service and control tasks and the provision of knowledge and skills have positive effects, whereas the intensity of BoD activity has a surprisingly negative effect. These findings underscore that the effects of the BoD on the entrepreneurship-innovation link are more complex than previously thought, pointing to the important role of both BoD composition and BoD functioning for enabling innovation in family SMEs.     

The guppy and the whale: Relational pluralism and start-ups' expropriation dilemma in partnership formation

Start-ups have a high need for resources yet face significant risks when forming partnerships with incumbents to access those resources. We propose that a partnership strategy based on relational pluralism, forming multiplex and multifaceted ties with partners, can mitigate these risks. Such ties offer the start-up increased legitimacy and a relational safeguard against resource misappropriation by more powerful partners. However, we propose that there is a limit to the effectiveness of relational pluralism. Its effect is weakened when the start-up becomes entirely dependent on a small set of partners, or when an additional tie yields resources that are redundant. We argue that the start-up only benefits when the gains from relational safeguarding and legitimacy outweigh the costs of dependence and redundancy. We empirically observe the co-evolution of start-ups’ interlocking directorate and strategic alliance networks in the Australian mining industry over a 10-year period. Our results show that start-ups that engage in relational pluralism perform better than both start-ups that form no alliances and start-ups that form stand-alone alliances. Having a very small portfolio of partners or one that skews heavily toward local partners, however, indeed limits the effectiveness of relational pluralism. Intriguingly, we also find that the temporal sequencing of relational pluralism matters. One of our central findings is that the best performing start-ups first form board interlocks with promising partners and add a strategic alliance later. This offers a rare glance at the temporal sequencing in which peripheral start-ups can gain exceptional performance through partnership formation.     

Language and market inclusivity for women entrepreneurship: the case of microfinance

Inclusive markets are key to fostering female entrepreneurship, and the microfinance sector has recognized and acted on this. Existing research has studied how institutions and organizational factors facilitate the process by which microfinance and other financial intermediaries tackle gender-based financial exclusion. But while the role of cultural institutions has been recognized as important, little research has systematically integrated culture in the study of gender-based financial exclusion. We posit that language is a cultural institution that influences the extent to which financial intermediaries are successful in outreaching women and supporting female entrepreneurship. Inspired by a performativity approach, we develop a set of hypotheses that delineate how a specific feature of language, gender marking in grammar, moderates the role of institutional (state capacity) and organizational (NGO status and global ties) factors in shaping microfinance outreach to women. Using the ratio of female to male borrowers in 2361 microfinance organizations from 115 countries during the period 1995–2015, we confirm that market inclusion of women depends on organizational and institutional factors, and that gender marking in grammar influences those relationships.     

The intersection of entrepreneurship and selling: An interdisciplinary review,framework, and future research agenda

Selling is integral to entrepreneurship, yet it has rarely been a focal topic of analysis for entrepreneurship scholars. To address this, we undertake a broad-ranging systematic literature review of research that in some way explores selling within entrepreneurial contexts. We inductively develop a framework that orders extant research into selling antecedents, activities, contexts, and outcomes. Then, drawing on these entrepreneurship-selling intersections, we suggest opportunity theory can be extended by integrating critical insights from selling literatures. In particular, we address ego-centric views of entrepreneurship which prioritize entrepreneurial agency, and advocate for the incorporation of customer agency into synchronized processes of opportunity identification, refinement, and exploitation. The article concludes that a promising avenue for future theory development resides in the study of situated sales interactions, which can serve as an empirical vista to the underexplored entrepreneur-customer nexus.     

Women on board and performance of family firms: Evidence from India

This paper provides empirical evidence on the effect of woman directors on performance of family firms in the context of an emerging economy. Using data from India covering periods prior to and post institution of gender quotas, we find evidence that the presence of woman directors on board leads to higher firm performance. However, this positive effect is driven by independent woman directors. Further this effect gets attenuated when family members occupy key management positions in the firm. We conclude that governance structures of firms in emerging economies matter for the impact of woman directors on firm performance.     

Anti-corruption intensity and loan contracting: Evidence from non-state owned firms in China

We examine the effect of China’ s anti-corruption intensity on loan contracting efficiency. The findings suggest that conditional on the political connection (total factor productivity) of a firm, the anti-corruption intensity in the province in which a firm is located leads to less (more) favorable loan contracting terms. Additional analysis shows that the effect of anti-corruption intensity on loan contracting terms is stronger for firms with higher financing constraints and weaker external legal environments. We further find that higher anti-corruption intensity is related to lower credit growth at the macro level.     

Heterogeneity in performance within the bank holding company sector: Evidence and implications

The performance of banks affiliated with the holding company sector has been heavily investigated. Empirical studies have sought to determine if the alleged efficiency of holding companies does in fact exist; and if such efficiency outweighs the anticompetitive effects introduced into the banking structure. Research methodologies, nevertheless, have tended to view the holding company sector as homogeneous in its performance characteristics as compared to independent banking. In this study, however, it is found that there is considerable heterogeneity in performance within the holding company sector. The findings have implications for the direction of future research as well as the formation of public policy in banking.     

Seasoned equity offerings,operating performance and overconfidence: Evidence from the UK

Prior research on seasoned equity offerings in UK shows that equity issuers report a significant long-term underperformance in the period following the event. However, the factors contributing to such underperformance are not yet fully explored. Using a sample of rights issues for the period 1988–1998, this study suggest that the long-term underperformance is significantly related to a deterioration of companies’ operating fundamentals in the post-offering period. Further comparison between “Best” and “Worst” post-issue performers reveals that long-term underperformance is predominantly robust in the case of fastgrowing firms with over-optimistic management. This evidence is consistent with the managerial overconfidence and “empire-building” hypotheses.     

Call Auction Transparency and Market Liquidity: Evidence from China

This paper uses the natural experiment offered by the Shanghai Stock Exchange to investigate the impact of opening call auction transparency on market liquidity. We find that the dissemination of indicative trade information during the pre‐open call auction session leads to an overall improvement in stock liquidity in the continuous trading session. Bid‐ask spreads narrow in the first trading hour because adverse selection risk fell significantly and there is less price volatility in the continuous market. This effect is greater for actively traded securities than illiquid securities. Our findings are robust for different lengths of sample period, different lengths of trading hours after market open, and stocks that had (and had not) reformed the share split structure during our research period.     

Micro-entrepreneurship and subjective well-being: Evidence from rural Bangladesh

Microcredit has long been hailed as a powerful tool to promote livelihoods and reduce poverty through entrepreneurship. However, its impacts on people's subjective well-being remain underexplored. We present a unified theoretical framework for analyzing the effect of microcredit-enabled entrepreneurship on overall life satisfaction – a key manifestation of subjective well-being. Empirically, we apply an instrumental variable approach to a unique census-like household survey conducted in three villages of Bangladesh in 2013. In spite of having no direct effects, we find that microcredit borrowing has an indirect negative effect on overall life satisfaction, through increased worry. On a positive note, we find that female micro-borrowers experience an increase in satisfaction with financial security and achievement in life. We also provide evidence that micro-borrowers with higher levels of assets experience an increase in satisfaction with financial security.     

Institutional difference,organizational experience,and foreign affiliate performance: Evidence from Polish firms

We draw from the institutional economics and organizational learning theories to clarify two international business debates. The first debate involves how institutional distance affects foreign affiliate performance: some propose a negative and others a positive direct effect. We clarify this debate by differentiating between negative and positive institutional difference. The second debate involves how experience modifies this relationship: some propose a negative and others a positive moderating effect. We clarify this debate by differentiating between similar and dissimilar experience, creating four moderating effects: Advantage of Challenge Anticipation, Advantage of Opportunity Anticipation, Disadvantage of Polymath Downgrading, and Disadvantage of Specialist Upgrading.     

Environmental practices,family control,and corporate performance: Evidence from Chinese family firms

This study analyzes Chinese family firms to determine how environmental practices influence corporate performance in consideration of the moderating effect of family control. Based on hand-collected data of environmental practices and 698 Chinese listed family firms, the results show that the environmental practices and corporate financial performance (CFP) link can be captured by a U-shape, and environmental practices are positively associated with corporate social performance (CSP). Furthermore, family control positively moderates the relationship between environmental practices and performance. The findings provide systemic understandings of the CFP and CSP of family firms through important insights into environmental practices and family control.