AIB 2012 Conference Proceedings - Academy of International ...

SUNDAY
Session: 1.3.5 - Competitive
Track: 7 - Emerging Economies
FDI, MNEs and Emerging Economy Institutions
Presented On: July 1, 2012 - 13:00-14:15
Chair: Hemant Merchant, USF – St. Pete
Do Institutional Fields for Outward Foreign Direct Investment from Emerging Markets Matter A Case for
Theoretical Extension
Svetla Trifonova Marinova, Aalborg University
John Child, University of Birmingham
Marin Marinov, University of Gloucestershire
This paper examines institutional formation and institutional entrepreneurship relating to outward foreign direct
investment (OFDI) in China and Russia since the beginning of their market-oriented economic reforms. It
focuses on the stages of OFDI institutional development during these periods of major system change, with
particular reference to both the processes and outcomes involved. In each country, the state and its agencies
were the principal institutional entrepreneurs in developing the OFDI system. Consequently, the development of
OFDI institutions depended heavily on the extent to which state policy was consistent in supporting their
regulative, normative and cognitive pillars. The paper concludes by advancing theoretical propositions and an
analytical framework which posits various consequences of political and economic continuity for OFDI
institutional development, moderated by the level of institutional entrepreneurship coming from governmental
and business sources. (For more information, please contact: Svetla Trifonova Marinova, Aalborg University,
Denmark: svetla@business.aau.dk)
How Do Sub-National Institutional Constraints Impact Foreign Firm Performance
Xiaoying Li, Brunel University
Laixiang Sun, SOAS, University of London
This paper examines the impact of sub-national institutions on the performance of foreign firms in China.
Building on institutional theory, we envisage that the negative effect of sub-national institutional constraints is
moderated by firm size and age, entry mode, and market orientation. Our hypotheses are tested on a largefirm-level
dataset of about 29,000 foreign firms in 120 cities in China within the period of 1998-2005. We find
that firm size and age both have a diminishing positive impact on foreign firm performance; moreover, there is
a U-shaped relationship between firm age and foreign firm performance in cities with higher level institutional
constraints. We also find that joint ventures help mitigate the negative impact of sub-national institutional
constraints on foreign firm performance when the level of institutional constraints is higher. (For more
information, please contact: Xiaoying Li, Brunel University, United Kingdom: xiaoying.li@brunel.ac.uk)
Multiple Roles of Multinational Corporations, Local Institutions and Indigenous Technological Efforts in an
Emerging Economy
Zhenzhen Xie, Hong Kong University of Science and Technology
Getting engaged in competitive international markets motivates exporting firms to enhance their technological
capabilities and invest in research and development (R&D). However, R&D investment is one of several ways to
enhance technological capabilities. When there are other sources of knowledge available, exporters' tendency to
invest in R&D may be weakened. In the paper, three other sources of knowledge are identified: 1) multinational
corporations (MNC) as customers, 2) MNCs as parents, and 3) FDI in a local industry. An analysis on 5,595
AIB 2012 Conference Proceedings
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