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13-05-2019 | Research Article

How Do International Joint Ventures Build Legitimacy Effectively in Emerging Economies? CSR, Political Ties, or Both?

Authors: Xuan Bai, Jeanine Chang, Julie Juan Li

Published in: Management International Review | Issue 3/2019

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Abstract

Legitimacy has been identified as an important factor influencing the survival of international joint ventures (IJVs). Yet empirical studies exploring IJV strategies for gaining post-formation legitimacy are scarce. This study examines how IJVs accumulate legitimacy after their formation in China. We identify two non-market strategies, namely corporate social responsibility (CSR) and political ties, and compare their effects on gaining two types of legitimacy: political legitimacy and market legitimacy. Data obtained from senior and middle IJV managers in China lends empirical support for the direct effects of CSR and political ties on IJV legitimacy-building. Surprisingly, we find that CSR has a stronger effect on gaining both political and market legitimacy than political ties. Furthermore, both political and market legitimacy contribute to IJVs’ performance.

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Title: How Do International Joint Ventures Build Legitimacy Effectively in Emerging Economies? CSR, Political Ties, or Both?
Authors: Xuan Bai
Jeanine Chang
Julie Juan Li
Publication date: 13-05-2019
Publisher: Springer Berlin Heidelberg
Published in: Management International Review / Issue 3/2019
Print ISSN: 0938-8249
Electronic ISSN: 1861-8901
DOI: https://doi.org/10.1007/s11575-019-00382-x

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