Knowledge transfer, regulatory support, legitimacy, and financial performance: The case of foreign firms investing in China

Liao, Tsai-Ju; Yu, Chwo‐Ming Joseph

doi:10.1016/j.jwb.2010.10.026

Cited by 42 publications

(16 citation statements)

References 46 publications

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“…Good corporate image and reputation positively mediate the link between CSR and financial performance (Saeidi et al, 2015). Others (e.g., Liao and Yu, 2012;and Wang et al, 2014) also show the long-term positive effect of legitimacy on firm value. SA firms can thus legitimise their operations and improve firm value by appointing ethnic black directors.…”

Section: (I) Gender Ethnic Diversity and Firm Value: Theoretical Framentioning

confidence: 99%

Do Women and Ethnic Minority Directors Influence Firm Value? Evidence from Post‐Apartheid South Africa

Gyapong¹,

Monem²,

2016

Business Fin & Account

129

198

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Previous studies on the value relevance of board gender and ethnic diversity have produced mixed results. This paper re-examines this relationship using hand-collected data of 245 South African listed firms over the period [2008][2009][2010][2011][2012][2013]. We document a positive and significant effect of both board gender and ethnic diversity on firm value. We also find that the increase in firm value is greater when boards have three or more women directors. In contrast, ethnic minority directors contribute less to firm value when there are three or more on the board. Furthermore, we document that ethnicity has a concave relationship with firm value, but gender does not. We demonstrate that in better-governed firms, ethnic diversity is more value relevant than gender diversity. Our results also suggest that financial crisis is associated with the propensity to restructure boards along gender and ethnicity. This paper sheds new light on the effect of board diversity in South African firms as the government increasingly pursues policies aimed at eradicating the effects of apartheid. Our results are robust after controlling for self-selection and various forms of endogeneity.

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Section: (I) Gender Ethnic Diversity and Firm Value: Theoretical Framentioning

confidence: 99%

Do Women and Ethnic Minority Directors Influence Firm Value? Evidence from Post‐Apartheid South Africa

Gyapong¹,

Monem²,

2016

Business Fin & Account

129

198

View full text Add to dashboard Cite

show abstract

“…While the former is more related to competitive relationships and industry-specific knowledge and resources, COCs enable the member firms to have easier and more frequent access to a variety of local and market related knowledge and typically exhibit cooperative inter-firm relations and a high level of trust (Tan and Meyer 2011). Co-locating and interacting actively with managers from the same origin in a specific place can facilitate the creation of the so-called ISC, which has to do with the tacit knowledge and resources that help firms of that network act in an isomorphic manner, gain legitimacy in the local environment, overcome LOO, and reduce knowledge-expropriation hazards or leakages (Tan andMeyer, 2011, Liao andYu, 2012).…”

Section: The Place In the Host Country As A Learning And Knowledge Plmentioning

confidence: 99%

Developing international social capital: The role of communities of practice and clustering

Urzelai

Puig

2019

International Business Review

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One criteria regarding where to invest in foreign markets is linked to the international social capital (ISC) that exists on the place, which enables the access to local knowledge and other location-specific advantages. There are alternative ways to create and make use of that ISC that are still unexplored by International Business literature. In this paper, we study the geographic communities of practice (CoP) that are formed by FDI firms from the same country-of-origin (the so-called country-of-origin clusters). For that purpose, the paper adopts a qualitative methodological approach through an inductive case study of expatriates from 13 Spanish subsidiaries co-located in China. Our findings suggest that there are particular mechanisms based on the informal connections and repeated interactions facilitated by a common language and non-competitive relationships that create an ISC in the CoP. Moreover, our analysis shows there is a heterogeneity in the way these mechanisms are developed and used by the member firms, and this is due to organizational and individual factors, as well as leadership dynamics. Our work contributes to Internationalization and Network theories by identifying unexplored mechanisms through which the ISC is developed at the host country level. Besides, it helps identifying competences (i.e. clustering competences) that help expatriate managers to be successful in their international assignments.

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“…Bigger firms contribute more to externalities and benefit less from agglomeration vis‐à‐vis smaller competitors (Shaver and Flyer, ). Let us recall Marshall's sources of agglomeration benefits, which are the creation of markets for specialized labor or other inputs as well as learning across firms, for instance, through technology spillovers (Marshall, ; Liao and Yu, ). The contribution to each of these externality sources will typically increase with firm size.…”

Section: Theory and Hypothesesmentioning

confidence: 99%

The Effects of Foreign Direct Investment Colocation: Differences Between Manufacturing and Service Firms

Zschoche

2015

Manage Decis Econ

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Colocation may result in positive performance effects because of agglomeration benefits or in negative outcomes because of fiercer competition. Using the notions of industrial organization economics, this study offers a comprehensive industry‐specific analysis on the performance effects of international colocation. We predict that bigger firms will benefit more from colocation of foreign firms in a host country. Considering industry and home country peers, the analysis suggests that positive effects dominate for manufacturing firms whereas service firms are negatively affected. However, these effects are mitigated by a firm's size in a location. A large‐scale empirical analysis on firm‐level data supports the hypotheses. Copyright © 2015 John Wiley & Sons, Ltd.

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Knowledge transfer, regulatory support, legitimacy, and financial performance: The case of foreign firms investing in China

Cited by 42 publications

References 46 publications

Do Women and Ethnic Minority Directors Influence Firm Value? Evidence from Post‐Apartheid South Africa

Do Women and Ethnic Minority Directors Influence Firm Value? Evidence from Post‐Apartheid South Africa

Developing international social capital: The role of communities of practice and clustering

The Effects of Foreign Direct Investment Colocation: Differences Between Manufacturing and Service Firms

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