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Home bitter home: How labor protection influences firm offshoring

Published on Nov 1, 2018in Journal of World Business5.79
· DOI :10.1016/j.jwb.2018.03.007
David H. Weng5
Estimated H-index: 5
(VU: VU University Amsterdam),
Mike W. Peng60
Estimated H-index: 60
(UTD: University of Texas at Dallas)
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Abstract
Drawing on the home country literature, we argue that firms headquartered or located in countries with strong labor protection may face challenges in their domestic operations. These firms are likely to initiate offshoring to enhance operational efficiency. Building on this argument, we also examine the boundary conditions moderating this proposed effect including labor productivity and employee stock ownership. Results based on a sample of information technology firms operating within five developed countries during 1990–2010 provide support for these arguments. These findings suggest that offshoring can be a partial exit strategy for firms to address the institutional challenges in their home country.
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  • Citations (5)
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References86
Newest
Purpose The purpose of this study is to use the rise of emerging-market multinationals as a vehicle to explore how a firm’s country of origin influences its internationalization. Design/methodology/approach This paper is a conceptual paper. Findings We argue that the home country’s institutional and economic underdevelopment can influence the internationalization of firms in two ways. First, emerging-market firms may leverage innovations made at home to cope with underdeveloped institutions or e...
Published on Dec 1, 2016in Journal of International Management2.83
Yadong Luo64
Estimated H-index: 64
(UM: University of Miami),
Huan Zhang1
Estimated H-index: 1
(SYSU: Sun Yat-sen University)
The growth of emerging market multinational enterprises (EM MNEs) has enriched existing international business theories but conveyed also new puzzles and questions for these theories and perspectives. To synthesize what we know and what we do not concerning international expansion of EM MNEs, we use the qualitative content analysis method, systematically reviewing 166 articles from 11 leading IB and management journals published during the period of 1990–2014. Our review examines five major area...
Published on Aug 1, 2016in Strategic Management Journal5.57
Alicia Rodríguez5
Estimated H-index: 5
(ISCIII: Instituto de Salud Carlos III),
María Jesús Nieto16
Estimated H-index: 16
(ISCIII: Instituto de Salud Carlos III)
Research summary: In this article, we address the role of R&D offshoring strategies in the sales growth of small- and medium-sized enterprises (SMEs). We propose that different governance modes of R&D offshoring—insourcing versus outsourcing—may lead to growth, but that they differ in their effects. In turn, we argue that innovation mediates the relation between international R&D sourcing strategies and sales growth. Based on a large database of SME manufacturing enterprises in Spain, we find th...
Published on Jul 1, 2016in Journal of Management9.06
Valentina Marano4
Estimated H-index: 4
(NU: Northeastern University),
Jean-Luc Arregle9
Estimated H-index: 9
(EMLYON Business School)
+ 2 AuthorsMarc van Essen16
Estimated H-index: 16
(HSG: University of St. Gallen)
We propose that the mixed findings of research on the internationalization-performance (I-P) relationship reflect its failure to adequately consider the moderating role of firms’ home country formal and informal institutions. This general hypothesis is supported in a meta-analysis of the firm-, industry-, home country–, and host country–level factors driving the I-P relationship across 32 countries between 1972 and 2012 from 359 primary studies—the largest sample of primary studies of any meta-a...
Published on Oct 1, 2015in Journal of International Business Studies7.72
Azizjon Alimov4
Estimated H-index: 4
(CityU: City University of Hong Kong)
This article exploits changes in country-level employment protection regulations as a source of plausibly exogenous variation in labor laws and finds that these regulations play an important role in cross‐border merger activity. Over the 1991–2009 period, countries that tighten employment regulations attract more foreign acquirers, especially those from countries with relatively more flexible labor regulations. The results appear to be robust to alternative specifications. Importantly these patt...
Published on Sep 1, 2015in Strategic Management Journal5.57
Yi Tang8
Estimated H-index: 8
(PolyU: Hong Kong Polytechnic University),
Cuili Qian8
Estimated H-index: 8
(CityU: City University of Hong Kong)
+ 1 AuthorsRui Shen4
Estimated H-index: 4
(NTU: Nanyang Technological University)
Grounded in the upper echelons perspective and stakeholder theory, this study establishes a link between CEO hubris and corporate social responsibility (CSR). We first develop the theoretical argument that CEO hubris is negatively related to a firm’s socially responsible activities but positively related to its socially irresponsible activities. We then explore the boundary conditions of hubris effects and how these relationships are moderated by resource dependence mechanisms. With a longitudin...
Published on Feb 1, 2015in Journal of Economic Behavior and Organization1.40
Ulrich Kaiser18
Estimated H-index: 18
,
Hans Christian Kongsted12
Estimated H-index: 12
(CBS: Copenhagen Business School),
Thomas Rønde13
Estimated H-index: 13
(CBS: Copenhagen Business School)
We investigate the effect of mobility of R&D workers on the total patenting activity of their employers. Our study documents how mobile workers affect the patenting activity of the firm they join and the firm they leave. The effect of labor mobility is strongest if workers join from patent-active firms. We also find evidence of a positive feedback effect on the former employer's patenting from workers who have left for another patent-active firm. Summing up the effects of joining and leaving wor...
Published on Jan 25, 2015
Alvaro Cuervo-Cazurra32
Estimated H-index: 32
Abstract I study the relationship between pro-market reforms and the expansion of emerging market multinational companies (EMNCs). Extending institutional economics, I propose a co-evolutionary process, whereby pro-market reforms in emerging markets induce the transformation of domestic firms into EMNCs, and the global expansion of EMNCs in turn facilitates the deepening of pro-market reforms in the home country. Specifically, I first explain how pro-market reforms lead to the emergence of EMNCs...
Published on Sep 1, 2014in Strategic Management Journal5.57
Jun Xia13
Estimated H-index: 13
(UTD: University of Texas at Dallas),
Xufei Ma14
Estimated H-index: 14
(CUHK: The Chinese University of Hong Kong)
+ 1 AuthorsDaphne W. Yiu18
Estimated H-index: 18
(CUHK: The Chinese University of Hong Kong)
This study examines and extends the resource dependence logic of diversification for a better understanding of outward foreign direct investment (OFDI) activities by emerging market firms. We contend that the diversification logic is bounded by state ownership, an important but less considered component of interdependence. Our empirical results, based on panel data analysis of Chinese listed firms, suggest that the level of interdependence between Chinese and foreign firms in China in multiple f...
Cited By5
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Published on Nov 1, 2018in Long Range Planning3.36
David H. Weng5
Estimated H-index: 5
(VU: VU University Amsterdam),
Hsiang-Lin Cheng (CCU: National Chung Cheng University)
Abstract How does a subsidiary's organizational identification influence its tendency to demonstrate initiative? In this study, we argue that a subsidiary's organizational identification with the MNE may affect its initiative via two mechanisms: subsidiary motivation and headquarters screening. On the one hand, subsidiary motivation mechanism suggests that a subsidiary's organizational identification with an MNE may affect its tendency to demonstrate initiative. On the other hand, the headquarte...
Published on May 1, 2019in Global Strategy Journal2.73
Alvaro Cuervo-Cazurra32
Estimated H-index: 32
,
Ram Mudambi42
Estimated H-index: 42
,
Torben Pedersen45
Estimated H-index: 45
Published on Jan 1, 2019in Journal of Management Studies5.84
Nina Rosenbusch8
Estimated H-index: 8
(WLU: Wilfrid Laurier University),
Michael Gusenbauer1
Estimated H-index: 1
(Johannes Kepler University of Linz)
+ 2 AuthorsKlaus E. Meyer7
Estimated H-index: 7
(UWO: University of Western Ontario)
Innovation offshoring (IO) has become a widespread management practice. Yet, evidence on the performance implications is inconsistent, and scattered across disciplines and contexts. We argue that the benefits firms can derive from IO depend on the institutional environment at home. Drawing on recent work on institutional theory in international business, we explore institutions that facilitate reverse knowledge transfer and/or institutional arbitrage with respect to innovation-related activities...
Published on Dec 1, 2018in Asia Pacific Journal of Management2.74
Mike W. Peng60
Estimated H-index: 60
(UTD: University of Texas at Dallas),
Sergey Lebedev2
Estimated H-index: 2
(SFSU: San Francisco State University)
+ 2 AuthorsJason Shay1
Estimated H-index: 1
Starting with Peng and Heath (Academy of Management Review, 21: 492–528, 1996), the growth of the firm in emerging economies (EE) has received increasing attention in the literature in the last two decades. This line of research has not only extended our knowledge on firms’ strategic choices to the context of EE, but also proposed new perspectives on the growth of the firm. Leveraging prior research, this article focuses on three major modes for firm growth—organic, acquisitive, and network-base...
Published on Jun 1, 2019in Journal of International Business Studies7.72
Alvaro Cuervo-Cazurra32
Estimated H-index: 32
(NU: Northeastern University),
Ajai S. Gaur29
Estimated H-index: 29
(RU: Rutgers University),
Deeksha Singh9
Estimated H-index: 9
(RU: Rutgers University)
We review the literature analyzing the impact of pro-market institutions on firms’ global strategy. We propose that the ideological tension between whether the government or the market should drive economic development results in a pendulum of pro-market reforms and reversals that drive changes in firm strategy and performance. Much progress has been made in the analyses of pro-market reforms and their impact on firms’ international strategies and performance. However, there is a need to further...
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