Internationalization and innovation performance of emerging market enterprises: The role of host-country institutional development

Jie Wu, Chengqi Wang, Junjie Hong*, Panagiotis Piperopoulos, Shuaihe Zhuo

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

96 Citations (Scopus)

Abstract

We examine how host-country institutional development influences innovation performance of internationalized emerging market enterprises (EMEs). Our panel-data analysis of Chinese EMEs shows that although host-country institutional development on average enhances innovation performance of the parent, such effects are more pronounced for EMEs with strong absorptive capacity and for those diversifying into a larger number of countries. Interestingly, EMEs with a higher level of state ownership gain more when entering countries with a lower level of institutional development. Our findings offer insights regarding how latecomer EMEs should configure their portfolio of subsidiaries in order to enhance innovation performance of their parent.

Original languageEnglish
Pages (from-to)251-263
Number of pages13
JournalJournal of World Business
Volume51
Issue number2
Early online date18 Oct 2015
DOIs
Publication statusPublished - Feb 2016

Keywords

  • Absorptive capacity
  • Geographic diversification
  • Innovation performance
  • Institutional environment
  • Internationalization
  • State ownership

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