Informal institutions, entrepreneurs’ political participation, and venture internationalization

Li, Dan; Wei, Liqun; Cao, Qing; Chen, Deqiu

doi:10.1057/s41267-021-00402-9

Cited by 36 publications

(31 citation statements)

References 154 publications

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“…Since initially there were few entrepreneurs, who were mostly allocated into unproductive activities, it took even more time for the government to develop institutions that enhanced the quality of market transactions. More recently, the political influence of entrepreneurs resulted in new informal institutions that compensated for the lack of formal ones (Li et al, 2021). Chowdhury et al (2019) evaluated how formal and informal institutions account for variations in the quality and quantity of entrepreneurship across developing and developed countries, using data of 70 countries for the period 2005-2015.…”

Section: Entrepreneurship and Institutional Dynamics In Developed And...mentioning

confidence: 99%

The impact of the institutional environment on entrepreneurial activity: an analysis of developing and developed countries

Mello

Moraes

Fischer

2022

JEPP

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PurposeEntrepreneurship can be understood as a systemic phenomenon, thus relying on sets of influential factors associated with socioeconomic contexts. Institutional conditions play a pivotal role in this regard, affecting the allocation of entrepreneurial efforts. The goal of this research is to verify to what extent do the pillars of Countries' Institutional Profiles – regulatory, cognitive and normative – affect both the prevalence and quality of entrepreneurship, assessing the differences between developing and developed countries both in total entrepreneurial activity and in the following qualitative frames: innovation rate, high job creation expectations and motivational index.Design/methodology/approachThe authors’ assessment uses data from the Global Entrepreneurship Monitor (GEM) with a longitudinal approach for 112 countries over the period 2003–2019. Dynamic panel data regressions are applied.FindingsBy comparing developing and developed countries, findings highlight that institutional effects are heterogeneous among developing and developed countries, with informal institutions being more relevant for developing countries than formal ones. Also, using a broad range of institutional indicators, the authors’ assessment indicated that the association between institutional conditions and productive entrepreneurship seems to be far more intricate than argued by theoretical literature.Practical implicationsThe authors’ findings indicate the need for developing countries to address formal institutional voids in order to generate more effective conditions for productive entrepreneurship to emerge. Following prior literature, this can have systemic impacts on trajectories for economic growth and development.Originality/valueThe originality of this research consists in using a longitudinal and integrative approach to compare institutional effects on different types of entrepreneurship, as well as comparing these effects in countries at different stages of development.

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Section: Entrepreneurship and Institutional Dynamics In Developed And...mentioning

confidence: 99%

The impact of the institutional environment on entrepreneurial activity: an analysis of developing and developed countries

Mello

Moraes

Fischer

2022

JEPP

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“…Chen, Chen, & Huang, 2013; Luo, Huang, & Wang, 2012). A more recent line of research has explored the antecedents of guanxi activities and found this choice to be determined by individual-, firm-, and institutional-level factors (e.g., Bu & Roy, 2015; Karhunen, Kosonen, McCarthy, & Puffer, 2018; Li, Wei, Cao, & Chen, 2021; Nee, Holm, & Opper, 2018; Opper, Nee, & Holm, 2017). Opper et al (2017) proposed that while guanxi activities can protect the firm from serious risks, they are also inherently costly, such that the level of guanxi activities must be determined by a careful trade-off between risk and return.…”

Section: Applicability Of Classic Management Theories In Chinamentioning

confidence: 99%

Chinese Management Studies: A Matched-Samples Meta-Analysis and Focused Review of Indigenous Theories

Liu

Heugens

Wijen

et al. 2022

Journal of Management

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The field of Chinese management studies has grown tremendously over the past four decades. Management theories originating from the United States have remained dominant in the analysis of Chinese firms, prompting the question of how powerfully these Western lenses explain management practices in non-Western contexts. Through a matched-samples meta-analysis, which integrates matching techniques into meta-analysis, we compare the mean effect sizes for five classic Western management theories—institutional theory, resource dependence theory, the resource-based view, agency theory, and transaction cost theory—on 452 matched samples drawn from 1,028 U.S. and Chinese studies. Surprisingly, as compared to their U.S. counterparts, Chinese firms (a) are less responsive to coercive and mimetic pressures yet more subject to normative pressures, (b) establish fewer business relations when faced with resource dependencies and transaction costs, (c) extract more profit from managing generic strategic resources, and (d) are more sensitive to pay incentives and private blockholders. To understand the specificities of Chinese management practices, we furthermore conduct a focused review of the emerging literature on China-endemic explanations: political institutional imprinting theory, state-driven sustainable development, and China-endemic corporate governance. We conclude that indigenous theories effectively complement Western perspectives when accounting for Chinese management practices.

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“…Regarding the interplay between formal and informal institutions, the existing institutional research has long acknowledged and stressed that formal and informal institutions influence each other (Helmke & Levitsky, 2004; Horak & Restel, 2016; North, 1990). Studying Chinese entrepreneurs, Li, Wei, Cao, and Chen (Forthcoming) demonstrate that changes in formal institutions can provide a platform of political participation for entrepreneurs to build new types of informal institutions, shaping entrepreneurs' willingness and ability to engage in internationalization. In summary, research in this area remains sparse, even in the context of emerging economies.…”

Section: Institutions and Entrepreneurship: Clarifying Past Insightsmentioning

confidence: 99%

Institutions and entrepreneurship in a non‐ergodic world

Dan

Hitt

Batjargal

et al. 2021

Global Strategy Journal

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Research Summary This special issue advances the global strategy and entrepreneurship fields by providing a better understanding of the linkage between institutions and entrepreneurship. We provide an overview of existing literature in three key research areas: (a) the impact of institutions (types and complexity) on entrepreneurship, (b) the effect of institutional evolution (overall evolution and interplay among institutions) on entrepreneurship, and (c) the coevolution of institutions and entrepreneurship. We introduce the eight articles appearing in this special issue, examine the relationship between institutions and entrepreneurship in a non‐ergodic world, and highlight meaningful and promising avenues for future research in each of the three key research areas in the domain of institutions and entrepreneurship. Managerial Summary This study clarifies the complex relationship between institutions (the rules and norms that govern economic transactions) and entrepreneurship. Our discussion of existing literature, special issue articles, institutions and entrepreneurship in a world of significant change, and several promising avenues for future research highlights to entrepreneurs and their stakeholders the critical role that institutions play in entrepreneurial strategies and actions in three ways. First, the types of institutions and their complexity in a location alter entrepreneurs' incentives and ability to create new ventures. Second, the continued changes in institutions ‐ some in favor of free‐market relationships and others restricting them ‐ alter entrepreneurs' behaviors. Third, the entrepreneurial spirit and the creation of new ventures can drive the transformation of institutions that govern future market transactions.

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Informal institutions, entrepreneurs’ political participation, and venture internationalization

Cited by 36 publications

References 154 publications

The impact of the institutional environment on entrepreneurial activity: an analysis of developing and developed countries

The impact of the institutional environment on entrepreneurial activity: an analysis of developing and developed countries

Chinese Management Studies: A Matched-Samples Meta-Analysis and Focused Review of Indigenous Theories

Institutions and entrepreneurship in a non‐ergodic world

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