Pengcheng Ma, Lin Cui, Meitong Dong, Yi-Chuan Liao
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引用次数: 2
Abstract
Research Summary
This study investigates formal institutional pressure from government policy, informal institutional pressure from filial piety, and their interaction effect on firms' internationalization strategy. We argue that, while influenced by independent policy and cultural effects, firms also exercise agency when responding to these competing institutional pressures. We find empirical support for the influence of policy and cultural effects on firms' foreign direct investment (FDI). We also find that, in making decisions about FDIs, state-owned enterprises are more sensitive to government policy, whereas family businesses are more sensitive to filial piety.
Managerial Summary
This study reveals that firms' strategies in complex institutional environments are influenced by their needs for formal and informal institutional legitimacy. Managers can exercise agency by weighing the importance of formal and informal legitimacy differently and therefore vary in their responses to institutional pressures. However, managerial agency is bound by firm ownership type. Managers of state-owned firms prioritize formal institutional legitimacy, while their family business counterparts attend more to informal institutional legitimacy. Policymakers should be aware of this important difference between types of firms, which allows them to address noncompliance in a culturally sensitive and ultimately more effective way.
期刊介绍:
The Global Strategy Journal is a premier platform dedicated to publishing highly influential managerially-oriented global strategy research worldwide. Covering themes such as international and global strategy, assembling the global enterprise, and strategic management, GSJ plays a vital role in advancing our understanding of global business dynamics.