Pro-market institutions and outward FDI of emerging market firms: An institutional arbitrage logic

We offer new theory and evidence regarding the effects of pro-market institutions on outward foreign direct investment (FDI) of emerging market firms (EMFs). Drawing on the logic of institutional arbitrage, we integrate the escapism and exploitation mechanisms of EMF internationalization into a unified theoretical context. We propose an inverted U-shaped relationship between host market-supporting institutions (MSI) and the investment scale of an EMF’s FDI project in the country, showing an escape-driven upward slope for low-to-medium MSI levels and an exploitation-driven downward slope for medium-to-high MSI levels. We supplement this main argument with two boundary conditions: the alleviating effect of home market liberalization (HML) and the strengthening effect of home government subsidies (HGS), demonstrating the coexistence and variation of pro- and anti- market institutions in an emerging market. Using information on 1,450 FDI projects conducted by 288 Chinese listed firms in 116 host countries, we obtain supportive evidence for the predicted relationships between the three institutional forces. This study enriches the literatures on institutional arbitrage and pro-market institutions with evidence from EMFs.     

江苏企业“走出去”的模式及财务风险防控研究

随着中国“一带一路”倡议的逐步实施,越来越多的企业开始加入“走出去”的队伍。但是由于不同企业所处行业、资金实力、规模大小、对外投资目的等因素不尽相同,如果选择不恰当的模式往往会导致陷入经营困境。因此本文为江苏“走出去”企业提出相应的财务风险防控措施,旨在促进企业在国际化进程中健康、可持续发展。     

Shattered but smiling: Human resource management and the wellbeing of hotel employees during COVID-19

The purpose of this paper is to explore the human resource management (HRM) practices adopted by hotels during COVID-19 and to examine the impact of COVID-19 on the wellbeing of hotel employees using qualitative thematic analysis. This study presents HRM practices that organizations can use to effectively manage employees in uncertain times. There is compelling evidence that employee-centered HRM practices strongly impact employee wellbeing. This paper integrates the insights from an HRM framework for wellbeing using a job demands-resources model. The paper identifies themes that confirm and extend existing theories and models of wellbeing. The findings are important for policy makers by offering guidance for managing people effectively during tough times.     

Effects of financial constraints on export performance of firms during the global financial crisis: microeconomic evidence from Korea

This study uses a manufacturing firm-level panel data set of South Korea for 2006–2013 to investigate the effect of financial constraints on the export performance of firms, with particular emphasis on the corporate ownership structure. The empirical results show that foreign multinational corporation (MNC) subsidiaries are not affected by financial constraint during both crisis and noncrisis periods, implying advantages of foreign ownership. However, domestic firms suffer more from financial constraints on exports during crisis years. In particular, domestic firms without parent firms are financially constrained during both crisis and noncrisis periods. However, those with parent firms do not experience financial constraints during noncrisis periods, although they too suffer from them during crisis periods. Thus, parent–subsidiary linkage among domestic firms plays an important role in alleviating financial constraints on export activity in noncrisis years but not as much during crisis years. Therefore, domestic parent firms exhibit less resilience to the global financial crisis, in comparison to foreign MNC parent firms.     

Financial constraints on export market exit of domestic firms versus foreign multinational corporation subsidiaries in South Korea

Using a Korean manufacturing firm-level data set covering a range of years from 2006 to 2013, this study investigates how the financial condition of firms, such as liquidity, leverage, and cash flow ratio, affects exit from export markets. It also analyses whether the financial status of foreign multinational corporation (MNC) subsidiaries differs from that of domestic firms with respect to the hazard of export market exit, especially during a global financial crisis. The empirical results confirm that, for domestic firms, the hazard of export market exit is affected by the firms’ financial condition only during a financial crisis. In other words, the financial vulnerability of domestic firms increases during the crisis, resulting in the hazard of export market exit. However, financial situations for foreign MNC subsidiaries do not affect exits from export markets, indicating a ‘finance-factor comparative advantage’.     

Exploring Value‐Based Management Sophistication: The Role of Potential Economic Benefits and Institutional Influence

The complexity of value‐based management (VBM) is often not captured in empirical research. In particular, potential differences in the extent of VBM implementation are not considered. Firms are predominantly classified dichotomously into either VBM “adopters” or “non‐adopters.” In this study, we aim to fill this gap by introducing a framework to assess differences in the extent of VBM implementation (VBM‐sophistication) based on publicly available data. This approach enables us to study determinants of VBM‐sophistication based on a hand‐collected data set comprising 2,683 firm‐year observations from 16 European countries between 2005 and 2014. Specifically, we investigate (i) whether potential economic benefits associated with VBM implementation lead to a higher level of VBM‐sophistication, and (ii) if this relation is influenced by extra‐organizational institutions (e.g., industry norms). Our results indicate that companies exhibit higher VBM‐sophistication if certain firm characteristics that increase the potential economic benefits of VBM are present. Moreover, our study provides evidence that this effect is enhanced by extra‐organizational institutions that pressure and support firms in realizing the potential benefits of higher VBM‐sophistication.     

The Effect of Foreign Entry Regulation on Downstream Productivity: Microeconomic Evidence from China*

We examine the cross‐industry influence of foreign entry regulation (based on a novel measure) on the productivity outcomes of downstream firms through input–output linkages in China. In contrast to the significant liberalization of the manufacturing sector, restrictions on the service sector remained stringent over the period 1997–2007. We find a powerful depressant effect of foreign entry barriers imposed on the upstream manufacturing and service industries on the productivity of downstream manufacturers, and this effect depends on a number of industry‐ and firm‐specific features. Our research calls for further investment liberalization (particularly in the service sector) in China.     

东道国金融发展对中国企业对外直接投资的影响:二元边际与生产率门槛

文章基于中国上市企业2008-2015年对外直接投资数据,分析东道国金融发展在扩展边际和集约边际上对企业对外直接投资决策以及投资所需生产率水平的影响。研究发现,在不同生产率的企业中东道国金融发展的影响是异质性的。较高的金融发展水平会系统性地降低投资所需的生产率水平,进而促进中国企业对外直接投资的概率、次数和规模。进一步的研究还发现,在经济发展水平比中国高的东道国金融发展的生产率效应更显著,投资所需生产率下降得更多。尽管如此,高经济发展水平东道国的最低生产率门槛仍然高于低经济发展水平的东道国。控制了金融发展指标和企业全要素生产率的内生性后,结果依然稳健。     

Organizational leadership practices in MNCs: the effect of the HRs value as a competitive factor and the FDI structure

The main goal of the paper is to present the research results on the impact that the value ascribed to human resources (HRs) as a strategic competitive factor of a company and the structure of FDI may exert on the advancement level of organizational leadership practices (as one of the HRM subfunctions) in multinational companies (MNCs). The structure of FDI covered: legal form of the foreign entities, type of investment, i.e., brownfield vs. greenfield, and four indices, i.e., internationalization index (II), geographical spread index (GSI), country’s economic development index (EDC), and culture distance index (CDI). The research sample was composed of 200 headquarters of MNCs located in Poland. All in all, three variables seem to have the most visible impact on the activities in the area of organizational leadership development practices, i.e., ownership structure, centralization vs. decentralization practices and cultural distance. Less important, but identifiable influences come from the GS index, EDC index and the smallest one from II index.     

Creating a Sustainable Supply Chain Network by Adopting Relationship Management Strategies

ABSTRACT

Purpose: This paper develops a conceptual framework to analyze the impact of a supply chain network (SCN) structure on relationship management strategies (RMS) that focal firms apply to manage sustainability issues within the SCN.

Design/methodology/approach: This paper is based on a comprehensive review and analysis of the industrial marketing and purchasing (IMP), sustainable supply chain management (SSCM), and SCN literature.

Findings: The conceptual framework expands the network perspective in the SSCM context by considering the important role of the SCN structure in the firm’s decision-making process. Four factors (dependency, distance, power, and transparency) were found that are useful in conceptualizing the SCN structure. The conceptual framework also categorizes various sustainability practices into four RMS (noncompliance, transactional, dictatorial, and collaborative), which are needed to make an SCN more sustainable. In addition, 16 propositions are developed based on how firms may identify the most effective RMS to implement appropriate sustainability practices through examining their SCN structure.

Research limitations/implications: The conceptual framework, developed as a result of a comprehensive review of the literature, led to the development of 16 propositions, which can assist in furthering a research agenda on RMS to diffuse various sustainability practices within SCN structures.

Originality/value: The relationship between SCN structure and RMS in the sustainability context remains an under-researched but emerging area of interest. This paper leverages existing research to develop a conceptual framework suitable for empirical testing.