Institutions, resources, and entry strategies in emerging economies

Meyer, Klaus E., Estrin, Saul, Bhaumik, Sumon and Peng, Mike W. (2009). Institutions, resources, and entry strategies in emerging economies. Strategic management journal, 30 (1), pp. 61-80.

Abstract

We investigate the impact of market-supporting institutions on business strategies by analyzing the entry strategies of foreign investors entering emerging economies. We apply and advance the institution-based view of strategy by integrating it with resource-based considerations. In particular, we show how resource-seeking strategies are pursued using different entry modes in different institutional contexts. Alternative modes of entry—greenfield, acquisition, and joint venture (JV)—allow firms to overcome different kinds of market inefficiencies related to both characteristics of the resources and to the institutional context. In a weaker institutional framework, JVs are used to access many resources, but in a stronger institutional framework, JVs become less important while acquisitions can play a more important role in accessing resources that are intangible and organizationally embedded. Combining survey and archival data from four emerging economies, India, Vietnam, South Africa, and Egypt, we provide empirical support for our hypotheses.

Publication DOI: https://doi.org/10.1002/smj.720
Divisions: Aston Business School > Economics, Finance & Entrepreneurship
Aston Business School > Aston India Foundation for Applied Research
Aston Business School
Additional Information: This is the pre-peer reviewed version of the following article: Meyer, K. E., Estrin, S., Bhaumik, S., & Peng, M. W. (2009). Institutions, resources and entry strategies in emerging economies. Strategic management journal, 30(1), 61-80, which has been published in final form at http://onlinelibrary.wiley.com/doi/10.1002/smj.720/abstract
Uncontrolled Keywords: institutional theory,emerging economies,strategic adaptation to context,modes of entry,acquisitions,joint ventures,Business and International Management,Strategy and Management
Full Text Link: http://onlineli ... mj.720/abstract
Related URLs: http://www.scop ... tnerID=8YFLogxK (Scopus URL)
Published Date: 2009-01
Authors: Meyer, Klaus E.
Estrin, Saul
Bhaumik, Sumon
Peng, Mike W.

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