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Management International Review

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04.06.2019 | Research Article

How Home-Country Political Connections Influence the Internationalization of Service Firms

verfasst von: Tao Bai, Stephen Chen, Xiao He

Erschienen in: Management International Review | Ausgabe 4/2019

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Abstract

This study investigates how home-country political connections affect the internationalization of service firms. There are conflicting arguments in the literature on the effect of political connections on firms’ internationalization with some researchers arguing that political connections have a facilitating effect while others argue that they have a constraining effect. In this paper, we argue that which effect dominates largely depends on the type of firm–because of the importance of being locally responsive to customers and heterogeneity among service firms, it is difficult to transfer and utilize the benefits of home-country political connections in international markets, as they are context-specific and home-country based. We also argue that, compared to content-oriented services, process-oriented service firms face less need for customer involvement and have a greater dependency on technical skills; therefore, the negative effect of home-country political connections will be weaker in process-oriented service firms. However, marketing capabilities possessed by the firm can help firms transfer and utilize the home-grown advantages in other countries, which can positively moderate the relationship between political connections and internationalization. We test our hypotheses using data on a sample of publicly listed service firms in China from 2012 to 2016 in a dynamic panel model.

Vorheriger Artikel The Role of Non-market Strategies in Establishing Legitimacy: The Case of Service MNEs in Emerging Economies

Nächster Artikel How Multinational Banks in India Gain Legitimacy: Organisational Practices and Resources Required for Implementation

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Titel: How Home-Country Political Connections Influence the Internationalization of Service Firms
verfasst von: Tao Bai
Stephen Chen
Xiao He
Publikationsdatum: 04.06.2019
Verlag: Springer Berlin Heidelberg
Erschienen in: Management International Review / Ausgabe 4/2019
Print ISSN: 0938-8249
Elektronische ISSN: 1861-8901
DOI: https://doi.org/10.1007/s11575-019-00386-7

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