AIB 2012 Conference Proceedings - Academy of International ...

TUESDAY
Existing findings on determinants of entry mode remain inconclusive, especially when looking on transactioncost
determinants. In this paper we argue that this inconclusiveness can at least partially be explained by
missing out an important context factor: firm size. Based on meta-analytical evidence, specifically 130 effect
sizes of 57 empirical studies, our findings strongly support this line of reasoning, as we find significantly
different effect sizes and, in the case of internal and external uncertainty, even effect directions for SMEs and
MNEs. We intensely discuss the implications of our findings following two directions. On the one hand,
discussing how TCE and its measures could be better adjusted to the specific SME context. On the other hand,
theorizing on how TCE could be supplemented by additional theories to improve its applicability to SMEs. (For
more information, please contact: Alexander H. Wisgickl, WU Vienna, Austria: alexander.wisgickl@wu.ac.at)
Session: 3.4.12 - Interactive
Track: 8 - Developing Country MNCs
International Diversification, Performance and Developing Economy Firms
Presented On: July 3, 2012 - 14:30-15:45
Chair: Elizabeth L. Rose, Aalto University School of Economics
Diversification and Performance of Business Groups in Emerging Markets: Taiwan as Example
Cheng-Wen Yao, Tzu-Chi College of Technology
Angeline, Te-Yi Lin, National ChengChi University
As a distinctive phenomenon of emerging countries, business groups receive much attention of practitioners and
academics. Although many studies examine the relationship between diversification and business group
performance, most of them focus on the relationship between diversification and an affiliated firm's
performance. Due to the nature of business groups, and to explore a bigger picture of business group
performance, this study proposed that the impacts of diversification on a business group were different from
those on a single member firm. This study explored the impacts of different diversifications on the
performance of the whole business group. An OLS multiple regression model was used to test the hypothesis.
Results based on 101 high-tech business groups showed that diversification was beneficial to a business group.
All three types of diversification, including related diversification, unrelated diversification, and international
diversification, were positively related to business group performance. This finding indicated that a business
group performed better when it diversified internationally and into different industries. (For more information,
please contact: Cheng-Wen Yao, Tzu-Chi College of Technology, Taiwan: tomcwyao@gmail.com)
The Impact of FDI Type on the Relationship between Institutional Distances and the Performance of Foreign
Subsidiaries
Hsiao-Wen Lin, ChenChi University
In the context of MNEs, there are different arguments about the relationship between institutional distance and
foreign subsidiaries' performances. This paper tries to integrate the FDI type, up-stream and down-stream FDI,
into the model and propose that the construct will have a moderating effect. Because of the different motive of
FDI, institutional development of the host country, and country of origin effect of the two FDI types, this paper
provides propositions that under the situation of down-stream FDI, there is an inverted U-shaped relationship
between institutional distance and the performance of LDCs MNEs foreign subsidiaries, while opposite U shaped
relationship under up-stream FDI. (For more information, please contact: Hsiao-Wen Lin, ChenChi University,
Taiwan: 96355506@nccu.edu.tw)
AIB 2012 Conference Proceedings
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