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State Ownership and Political Connections

Published on Jan 22, 2019in Journal of Management 9.06
· DOI :10.1177/0149206318822113
Laszlo Tihanyi32
Estimated H-index: 32
(A&M: Texas A&M University),
Ruth V. Aguilera34
Estimated H-index: 34
(Ramon Llull University)
+ 4 AuthorsRoxana Turturea1
Estimated H-index: 1
(Aalto University)
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Abstract
The influence of the state on firms in the global economy is alive and well. States have become dominant owners of companies in many countries around the world. Firms have also increasingly established political connections to access resources and improve their competitive positions. Nonetheless, our understanding of how state ownership and political connections affect firm performance remains limited and marked by conflicting findings. Using meta-analytical techniques on a sample of 210 studies spanning 139 countries, we examine two key research questions: (a) How do state ownership and political connections affect firm strategies and financial performance? and (b) How does firm-level strategic decision making mediate the relationships between state ownership, political connections, and firm financial performance? Our findings show that state ownership has a small negative effect on firm financial performance and that political connections have no direct consequences for performance. However, we find evi...
  • References (131)
  • Citations (1)
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References131
Newest
Published on Aug 1, 2018in Global Strategy Journal 2.73
João Albino‐Pimentel2
Estimated H-index: 2
(USC: University of South Carolina),
Rahul Anand1
Estimated H-index: 1
(HEC Paris),
Pierre Dussauge19
Estimated H-index: 19
(HEC Paris)
Published on Sep 1, 2017in Strategic Management Journal 5.57
Jing Li19
Estimated H-index: 19
(SFU: Simon Fraser University),
Jun Xia13
Estimated H-index: 13
(University of Texas at Austin),
Zhouyu Lin2
Estimated H-index: 2
(JNU: Jinan University)
Research Summary Cross-border acquisitions may raise legitimacy concerns by host-country stakeholders, affecting the acquisition outcomes of foreign firms. We propose that theorization by local regulatory agencies is a key mechanism that links legitimacy concerns with acquisition outcomes. Given that theorization is time consuming and its outcome is uncertain, we argue that state-owned foreign firms experience a lower likelihood of acquisition completion and a longer duration for completing a de...
Published on Aug 1, 2017in Strategic Organization 3.11
Michael Hadani10
Estimated H-index: 10
(Saint Mary's College of California),
Jean-Philippe Bonardi11
Estimated H-index: 11
(UNIL: University of Lausanne),
Nicolas M Dahan1
Estimated H-index: 1
(California State University, Monterey Bay)
Although significant scholarship has been devoted to the study of corporate political activity, contradictory messages emerge regarding its impact on public policy outcomes and firm performance. Using meta-analytic methods on a US-only sample of 93 studies, working papers, and books, we try to disentangle two mechanisms that explain why corporate political activity is not always beneficial to firms: (1) the uncertainty about the public policy process itself, that is, can firms get the policies t...
Published on Jun 1, 2017in Administrative Science Quarterly 8.02
Kevin Zheng Zhou34
Estimated H-index: 34
(HKU: University of Hong Kong),
Gerald Yong Gao13
Estimated H-index: 13
(UMSL: University of Missouri–St. Louis),
Hongxin Zhao1
Estimated H-index: 1
(SLU: Saint Louis University)
Using two longitudinal panel datasets of Chinese manufacturing firms, we assess whether state ownership benefits or impedes firms’ innovation. We show that state ownership in an emerging economy enables a firm to obtain crucial R&D resources but makes the firm less efficient in using those resources to generate innovation, and we find that a minority state ownership is an optimal structure for innovation development in this context. Moreover, the inefficiency of state ownership in transforming R...
Published on May 1, 2017in Research Policy 5.42
Marco Di Cintio3
Estimated H-index: 3
(University of Salento),
Sucharita Ghosh8
Estimated H-index: 8
(University of Akron),
Emanuele Grassi3
Estimated H-index: 3
(University of Salento)
We study firms’ export and RD (ii) RD and (iii) pure exports are not a driver of employment growth and worker flows.
Published on Apr 1, 2017in Journal of Management 9.06
Masaaki Kotabe48
Estimated H-index: 48
(TU: Temple University),
Crystal X. Jiang6
Estimated H-index: 6
(Bryant University),
Janet Y. Murray25
Estimated H-index: 25
(UMSL: University of Missouri–St. Louis)
By incorporating institutional theory with the dynamic capability perspective, we investigate how emerging-market firms’ organizational capability to acquire resources through political networking with government officials complements their absorptive capacity in enhancing incremental and radical innovations. We further investigate the conditions under which the complementary effect matters. On the basis of a survey of 108 senior executives in China, we find that political networking capability ...
Published on Mar 1, 2017in Administrative Science Quarterly 8.02
Heather A. Haveman22
Estimated H-index: 22
(University of California, Berkeley),
Nan Jia8
Estimated H-index: 8
(SC: University of Southern California)
+ 1 AuthorsYongxiang Wang10
Estimated H-index: 10
(SC: University of Southern California)
Economic transitions from state planning and redistribution to market exchange create many businesses opportunities. But such transitions also create great uncertainty because many interdependent factors – modes of exchange, types of products, and forms of organizations – are in flux. Uncertainty is even greater when political institutions remain authoritarian because then rule of law is weak and state bureaucrats retain considerable power over the economy. In such contexts, firms can reduce unc...
Published on Feb 13, 2017in Management Decision 1.96
Patricia Bachiller Baroja5
Estimated H-index: 5
Purpose Despite the vast literature on privatization, the relationship between change of ownership and performance is not clear. The purpose of this paper is to understand why divergences are found between the empirical results of papers analyzed. Design/methodology/approach The author applies a meta-analysis to a sample of 60 empirical studies that analyze the performance of privatized companies. The author checks whether different results on performance can be explained by the method of privat...
Published on Feb 1, 2017in Journal of Corporate Finance 2.35
Juliet D'Souza6
Estimated H-index: 6
(Georgia Gwinnett College),
William L. Megginson38
Estimated H-index: 38
(OU: University of Oklahoma)
+ 1 AuthorsZuobao Wei10
Estimated H-index: 10
(UTEP: University of Texas at El Paso)
In this study, we employ the World Bank Enterprise Survey (WBES) data collected in 2002, 2005, and 2009 for 21499 firms from 27 Eastern European and Central Asian countries to examine firm-level growth constraints faced by privatized firms versus those faced by the originally (de novo) private firms. We find that the de novo firms experience significantly higher financial, corruption, and legal obstacles than the privatized firms. We further document that, even though faced with more obstacles i...
Published on Jan 1, 2017in Journal of Management 9.06
John R. Hollenbeck46
Estimated H-index: 46
(MSU: Michigan State University),
Patrick M. Wright52
Estimated H-index: 52
(USC: University of South Carolina)
In this editorial we discuss the problems associated with HARKing (Hypothesizing After Results Are Known) and draw a distinction between Sharking (Secretly HARKing in the Introduction section) and Tharking (Transparently HARKing in the Discussion section). Although there is never any justification for the process of Sharking, we argue that Tharking can promote the effectiveness and efficiency of both scientific inquiry and cumulative knowledge creation. We argue that the discussion sections of a...
Cited By1
Newest
Published in Journal of Management 9.06
Omar El Nayal , J. (Hans) van Oosterhout9
Estimated H-index: 9
(EUR: Erasmus University Rotterdam),
Marc van Essen16
Estimated H-index: 16
(USC: University of South Carolina)
Although the appointment of politicians to corporate boards is a highly prevalent corporate political strategy, empirical evidence remains inconclusive as to whether and how such appointments creat...
Published on Jun 1, 2019in Journal of International Business Studies 7.72
Ruth V. Aguilera34
Estimated H-index: 34
(NU: Northeastern University),
Valentina Marano4
Estimated H-index: 4
(NU: Northeastern University),
Ilir Haxhi4
Estimated H-index: 4
(UvA: University of Amsterdam)
We review four decades of research about the corporate governance of multinational corporations (MNCs), which we label International Corporate Governance (ICG). We identify and discuss three main streams of research that draw on different conceptualizations and theoretical lenses of (corporate) governance. After synthesizing their respective findings, we propose several avenues for future research that integrate these three streams of research with the goal of developing a more nuanced understan...