Institutional relatedness behind product diversification and international diversification
© 2017 Springer Science+Business Media New YorkPrevious diversification research has largely focused on product relatedness, but ignored institutional relatedness—the degree of informal embeddedness with the dominant institutions that confer resources and legitimacy. We argue that during institution...
| Main Authors: | , , |
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| Format: | Journal Article |
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Springer New York LLC
2017
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| Online Access: | http://www.springer.com/business+&+management/business+for+professionals/journal/10490 http://hdl.handle.net/20.500.11937/62043 |
| _version_ | 1848760776061353984 |
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| author | Sun, S. Peng, Mike Tan, W. |
| author_facet | Sun, S. Peng, Mike Tan, W. |
| author_sort | Sun, S. |
| building | Curtin Institutional Repository |
| collection | Online Access |
| description | © 2017 Springer Science+Business Media New YorkPrevious diversification research has largely focused on product relatedness, but ignored institutional relatedness—the degree of informal embeddedness with the dominant institutions that confer resources and legitimacy. We argue that during institutional transitions, political ties and international experience represent different types of institutional relatedness linking firms, respectively, to political institutions and market institutions. Specifically, CEOs’ political ties may help firms access critical resources, sense new market entry opportunities, and gain board support to increase firms’ product diversification. CEOs’ international experience may help firms leverage different market-based capabilities, engage in international competition, and then lead firms to grow on a different path by expanding internationally. We further investigate a crucial contingency factor: the degree of economic freedom. Data from 11,992 firm-year observations based on firms listed on China’s stock exchanges between 2001 and 2011 largely support our predictions. |
| first_indexed | 2025-11-14T10:21:09Z |
| format | Journal Article |
| id | curtin-20.500.11937-62043 |
| institution | Curtin University Malaysia |
| institution_category | Local University |
| last_indexed | 2025-11-14T10:21:09Z |
| publishDate | 2017 |
| publisher | Springer New York LLC |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | curtin-20.500.11937-620432018-02-01T05:56:17Z Institutional relatedness behind product diversification and international diversification Sun, S. Peng, Mike Tan, W. © 2017 Springer Science+Business Media New YorkPrevious diversification research has largely focused on product relatedness, but ignored institutional relatedness—the degree of informal embeddedness with the dominant institutions that confer resources and legitimacy. We argue that during institutional transitions, political ties and international experience represent different types of institutional relatedness linking firms, respectively, to political institutions and market institutions. Specifically, CEOs’ political ties may help firms access critical resources, sense new market entry opportunities, and gain board support to increase firms’ product diversification. CEOs’ international experience may help firms leverage different market-based capabilities, engage in international competition, and then lead firms to grow on a different path by expanding internationally. We further investigate a crucial contingency factor: the degree of economic freedom. Data from 11,992 firm-year observations based on firms listed on China’s stock exchanges between 2001 and 2011 largely support our predictions. 2017 Journal Article http://hdl.handle.net/20.500.11937/62043 10.1007/s10490-016-9498-4 http://www.springer.com/business+&+management/business+for+professionals/journal/10490 Springer New York LLC restricted |
| spellingShingle | Sun, S. Peng, Mike Tan, W. Institutional relatedness behind product diversification and international diversification |
| title | Institutional relatedness behind product diversification and international diversification |
| title_full | Institutional relatedness behind product diversification and international diversification |
| title_fullStr | Institutional relatedness behind product diversification and international diversification |
| title_full_unstemmed | Institutional relatedness behind product diversification and international diversification |
| title_short | Institutional relatedness behind product diversification and international diversification |
| title_sort | institutional relatedness behind product diversification and international diversification |
| url | http://www.springer.com/business+&+management/business+for+professionals/journal/10490 http://hdl.handle.net/20.500.11937/62043 |