AIB 2012 Conference Proceedings - Academy of International ...

TUESDAY
firms both at home and in foreign markets. They can also influence their ability to innovate and take risks as
well as foster entrepreneurship. The purpose of organizing this Panel Session is to identify and explore some of
the potential changes and opportunities that will be experienced in the uprising Islamic societies and exchange
research ideas and insights of how the expected "Islamic institutional environments" might
encourage/discourage entrepreneurial activities of individuals and organizations. (For more information, please
contact: Mehdi Farashahi, Concordia University, Canada: mfarashahi@jmsb.concordia.ca)
Session: 3.4.3 - Competitive
Track: 8 - Developing Country MNCs
International Strategies of Developing Economy Firms: Resources, Capabilities and Entry
Modes
Presented On: July 3, 2012 - 14:30-15:45
Chair: Douglas Dow, University of Melbourne
The Bargaining Model Revisited: Theory and Evidence from China's Natural Resource Investments in Africa
Jing Li, Simon Fraser University
Aloysius Newenham-Kahindi, University of Saskatchewan
Daniel M. Shapiro, Simon Fraser University
Victor Zitian Chen, University of North Carolina; Columbia University
Recent years have witnessed rapid growth of Chinese OFDI in natural resource industries. Given the strategic
importance of the natural resource sectors to host country governments, MNE-host country government
bargaining occurs often in these sectors. The traditional bargaining models suggest that MNEs largely rely on
their FSAs to negotiate for investment deals. Chinese firms, however, typically have weak FSAs. Our study
investigates the role of the Chinese government in facilitating Chinese natural resource investments in Africa.
Using interview information with firms and government officials in Tanzania, our study enriches existing
bargaining models. We find that the Chinese government/firms engage in a modified one-tier bargaining model
in which the Chinese government represents the collective interests of the Chinese firms in negotiating with the
host country government and the Chinese firms act as executers of negotiation outcomes. To increase its
bargaining power, the Chinese government promises to provide aids with no political conditions, improve host
country infrastructures, and modernize local communities via multiple purpose projects. We further propose
boundary conditions for the Chinese bargaining model. Finally, we conclude that the Chinese OFDI model in
terms of the role played by the Chinese government is not new, nor it is it unique. (For more information,
please contact: Jing Li, Simon Fraser University, Canada: jingli@sfu.ca)
Leverage or Develop How Emerging Market Multinationals Manage their Business Models in their
Internationalization Processes
Margarete Kalinowski, ESADE Business School
Luis Vives, ESADE Business School
The phenomenal surge in internationalization by emerging market multinationals (EMNEs) has gained
momentum in academic research. The existing literature has focused on either exploitation of ownership
advantages or exploration of new advantages through opportunity seeking as the drivers of EMNEs'
internationalization. We contribute to the growing stream of research by exploring the questions of how EMNEs
manage their business models as they internationalize. We propose a conceptual framework depicted by two
key variables: (1) the level of institutional difference in terms of entry into emerging or developed markets, and
(2) strategic initiatives in terms of leveraging their own business models or developing new business models.
We obtain four possible strategies to manage business models EMNEs can follow in their expansion to other
AIB 2012 Conference Proceedings
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