Peer effects in outward foreign direct investment: evidence from China
Purpose Most previous research assumes that the outward foreign direct investment (OFDI) decisions of multinational corporations (MNCs) are made independently of the actions or characteristics of their peers. Therefore, the important influence of peer effects on the OFDI strategy is often neglected....
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| Veröffentlicht in: | Management decision 2020-03, Vol.58 (4), p.705-724 |
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| container_title | Management decision |
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| creator | Wang, Ruicheng Zhou, William Chongyang |
| description | Purpose
Most previous research assumes that the outward foreign direct investment (OFDI) decisions of multinational corporations (MNCs) are made independently of the actions or characteristics of their peers. Therefore, the important influence of peer effects on the OFDI strategy is often neglected. The purpose of this paper is to identify two broad categories of peer effects, i.e. learning-based and profit-driven imitations and examine the important influence of peer effects on MNCs’ internationalization strategy.
Design/methodology/approach
Using Chinese manufacturing firms as the empirical sample, the authors employ an econometric method (logit regression) to test the relationship between peer effects and an internationalization strategy.
Findings
Learning-based and profit-driven imitations are positively associated with a focal MNC’s OFDI decision. Policy uncertainty also positively moderates the relationship between peer effects and the OFDI strategy. Moreover, both peer effects are amplified when a firm is equipped with a dense export network.
Originality/value
The study offers researchers and practitioners a detailed view of interorganizational imitation behavior in terms of an internationalization strategy. |
| doi_str_mv | 10.1108/MD-11-2018-1194 |
| format | Article |
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Most previous research assumes that the outward foreign direct investment (OFDI) decisions of multinational corporations (MNCs) are made independently of the actions or characteristics of their peers. Therefore, the important influence of peer effects on the OFDI strategy is often neglected. The purpose of this paper is to identify two broad categories of peer effects, i.e. learning-based and profit-driven imitations and examine the important influence of peer effects on MNCs’ internationalization strategy.
Design/methodology/approach
Using Chinese manufacturing firms as the empirical sample, the authors employ an econometric method (logit regression) to test the relationship between peer effects and an internationalization strategy.
Findings
Learning-based and profit-driven imitations are positively associated with a focal MNC’s OFDI decision. Policy uncertainty also positively moderates the relationship between peer effects and the OFDI strategy. Moreover, both peer effects are amplified when a firm is equipped with a dense export network.
Originality/value
The study offers researchers and practitioners a detailed view of interorganizational imitation behavior in terms of an internationalization strategy.</description><identifier>ISSN: 0025-1747</identifier><identifier>EISSN: 1758-6070</identifier><identifier>DOI: 10.1108/MD-11-2018-1194</identifier><language>eng</language><publisher>London: Emerald Publishing Limited</publisher><subject>Acquisitions & mergers ; Competition ; Competitive advantage ; Emerging markets ; Foreign investment ; Globalization ; Host country ; International business ; Market entry ; Market positioning ; Multinational corporations ; Peers</subject><ispartof>Management decision, 2020-03, Vol.58 (4), p.705-724</ispartof><rights>Emerald Publishing Limited</rights><rights>Emerald Publishing Limited 2019</rights><lds50>peer_reviewed</lds50><woscitedreferencessubscribed>false</woscitedreferencessubscribed><citedby>FETCH-LOGICAL-c354t-bb9fe2fa78878c3d363006ca3f5efc309879691e94f06ae9c8ed8a6f90b6909e3</citedby><cites>FETCH-LOGICAL-c354t-bb9fe2fa78878c3d363006ca3f5efc309879691e94f06ae9c8ed8a6f90b6909e3</cites><orcidid>0000-0001-9923-1949</orcidid></display><links><openurl>$$Topenurl_article</openurl><openurlfulltext>$$Topenurlfull_article</openurlfulltext><thumbnail>$$Tsyndetics_thumb_exl</thumbnail><linktohtml>$$Uhttps://www.emerald.com/insight/content/doi/10.1108/MD-11-2018-1194/full/html$$EHTML$$P50$$Gemerald$$H</linktohtml><link.rule.ids>314,776,780,961,11614,27901,27902,52664</link.rule.ids></links><search><creatorcontrib>Wang, Ruicheng</creatorcontrib><creatorcontrib>Zhou, William Chongyang</creatorcontrib><title>Peer effects in outward foreign direct investment: evidence from China</title><title>Management decision</title><description>Purpose
Most previous research assumes that the outward foreign direct investment (OFDI) decisions of multinational corporations (MNCs) are made independently of the actions or characteristics of their peers. Therefore, the important influence of peer effects on the OFDI strategy is often neglected. The purpose of this paper is to identify two broad categories of peer effects, i.e. learning-based and profit-driven imitations and examine the important influence of peer effects on MNCs’ internationalization strategy.
Design/methodology/approach
Using Chinese manufacturing firms as the empirical sample, the authors employ an econometric method (logit regression) to test the relationship between peer effects and an internationalization strategy.
Findings
Learning-based and profit-driven imitations are positively associated with a focal MNC’s OFDI decision. Policy uncertainty also positively moderates the relationship between peer effects and the OFDI strategy. Moreover, both peer effects are amplified when a firm is equipped with a dense export network.
Originality/value
The study offers researchers and practitioners a detailed view of interorganizational imitation behavior in terms of an internationalization strategy.</description><subject>Acquisitions & mergers</subject><subject>Competition</subject><subject>Competitive advantage</subject><subject>Emerging markets</subject><subject>Foreign investment</subject><subject>Globalization</subject><subject>Host country</subject><subject>International business</subject><subject>Market entry</subject><subject>Market positioning</subject><subject>Multinational corporations</subject><subject>Peers</subject><issn>0025-1747</issn><issn>1758-6070</issn><fulltext>true</fulltext><rsrctype>article</rsrctype><creationdate>2020</creationdate><recordtype>article</recordtype><sourceid>BENPR</sourceid><sourceid>GUQSH</sourceid><sourceid>M2O</sourceid><recordid>eNptkD1PwzAQhi0EEqUws1pidnuOE8dmQy0FpFYwwGw5zhlSNUmx0yL-Pa7KgsT0Du_HnR5CrjlMOAc1Xc0Z5ywDrpLq_ISMeFkoJqGEUzICyArGy7w8JxcxrgG4KAo5IosXxEDRe3RDpE1H-93wZUNNfR-wee9o3YRkJWePcWixG24p7psaO4fUh76ls4-ms5fkzNtNxKtfHZO3xf3r7JEtnx-eZndL5kSRD6yqtMfM21KpUjlRCykApLPCF-idAK1KLTVHnXuQFrVTWCsrvYZKatAoxuTmuLsN_ecufWTW_S506aTJCiGyTMlMpNT0mHKhjzGgN9vQtDZ8Gw7mAMus5knNAZY5wEqNybGBLQa7qf8p_KErfgCGFmm9</recordid><startdate>20200317</startdate><enddate>20200317</enddate><creator>Wang, Ruicheng</creator><creator>Zhou, William Chongyang</creator><general>Emerald Publishing Limited</general><general>Emerald Group Publishing Limited</general><scope>AAYXX</scope><scope>CITATION</scope><scope>0U~</scope><scope>1-H</scope><scope>7WY</scope><scope>7WZ</scope><scope>7XB</scope><scope>8AO</scope><scope>8FI</scope><scope>AFKRA</scope><scope>AZQEC</scope><scope>BENPR</scope><scope>BEZIV</scope><scope>CCPQU</scope><scope>DWQXO</scope><scope>FYUFA</scope><scope>F~G</scope><scope>GNUQQ</scope><scope>GUQSH</scope><scope>K6~</scope><scope>K8~</scope><scope>L.-</scope><scope>L.0</scope><scope>M0C</scope><scope>M0T</scope><scope>M2O</scope><scope>MBDVC</scope><scope>PQBIZ</scope><scope>PQEST</scope><scope>PQQKQ</scope><scope>PQUKI</scope><scope>Q9U</scope><orcidid>https://orcid.org/0000-0001-9923-1949</orcidid></search><sort><creationdate>20200317</creationdate><title>Peer effects in outward foreign direct investment: evidence from China</title><author>Wang, Ruicheng ; Zhou, William Chongyang</author></sort><facets><frbrtype>5</frbrtype><frbrgroupid>cdi_FETCH-LOGICAL-c354t-bb9fe2fa78878c3d363006ca3f5efc309879691e94f06ae9c8ed8a6f90b6909e3</frbrgroupid><rsrctype>articles</rsrctype><prefilter>articles</prefilter><language>eng</language><creationdate>2020</creationdate><topic>Acquisitions & mergers</topic><topic>Competition</topic><topic>Competitive advantage</topic><topic>Emerging markets</topic><topic>Foreign investment</topic><topic>Globalization</topic><topic>Host country</topic><topic>International business</topic><topic>Market entry</topic><topic>Market positioning</topic><topic>Multinational corporations</topic><topic>Peers</topic><toplevel>peer_reviewed</toplevel><toplevel>online_resources</toplevel><creatorcontrib>Wang, Ruicheng</creatorcontrib><creatorcontrib>Zhou, William Chongyang</creatorcontrib><collection>CrossRef</collection><collection>Global News & ABI/Inform Professional</collection><collection>Trade PRO</collection><collection>ABI/INFORM Collection</collection><collection>ABI/INFORM Global (PDF only)</collection><collection>ProQuest Central (purchase pre-March 2016)</collection><collection>ProQuest Pharma Collection</collection><collection>Hospital Premium Collection</collection><collection>ProQuest Central UK/Ireland</collection><collection>ProQuest Central Essentials</collection><collection>ProQuest Central</collection><collection>Business Premium Collection</collection><collection>ProQuest One Community College</collection><collection>ProQuest Central Korea</collection><collection>Health Research Premium Collection</collection><collection>ABI/INFORM Global (Corporate)</collection><collection>ProQuest Central Student</collection><collection>Research Library Prep</collection><collection>ProQuest Business Collection</collection><collection>DELNET Management Collection</collection><collection>ABI/INFORM Professional Advanced</collection><collection>ABI/INFORM Professional Standard</collection><collection>ABI/INFORM Global</collection><collection>Healthcare Administration Database</collection><collection>Research Library</collection><collection>Research Library (Corporate)</collection><collection>ProQuest One Business</collection><collection>ProQuest One Academic Eastern Edition (DO NOT USE)</collection><collection>ProQuest One Academic</collection><collection>ProQuest One Academic UKI Edition</collection><collection>ProQuest Central Basic</collection><jtitle>Management decision</jtitle></facets><delivery><delcategory>Remote Search Resource</delcategory><fulltext>fulltext</fulltext></delivery><addata><au>Wang, Ruicheng</au><au>Zhou, William Chongyang</au><format>journal</format><genre>article</genre><ristype>JOUR</ristype><atitle>Peer effects in outward foreign direct investment: evidence from China</atitle><jtitle>Management decision</jtitle><date>2020-03-17</date><risdate>2020</risdate><volume>58</volume><issue>4</issue><spage>705</spage><epage>724</epage><pages>705-724</pages><issn>0025-1747</issn><eissn>1758-6070</eissn><abstract>Purpose
Most previous research assumes that the outward foreign direct investment (OFDI) decisions of multinational corporations (MNCs) are made independently of the actions or characteristics of their peers. Therefore, the important influence of peer effects on the OFDI strategy is often neglected. The purpose of this paper is to identify two broad categories of peer effects, i.e. learning-based and profit-driven imitations and examine the important influence of peer effects on MNCs’ internationalization strategy.
Design/methodology/approach
Using Chinese manufacturing firms as the empirical sample, the authors employ an econometric method (logit regression) to test the relationship between peer effects and an internationalization strategy.
Findings
Learning-based and profit-driven imitations are positively associated with a focal MNC’s OFDI decision. Policy uncertainty also positively moderates the relationship between peer effects and the OFDI strategy. Moreover, both peer effects are amplified when a firm is equipped with a dense export network.
Originality/value
The study offers researchers and practitioners a detailed view of interorganizational imitation behavior in terms of an internationalization strategy.</abstract><cop>London</cop><pub>Emerald Publishing Limited</pub><doi>10.1108/MD-11-2018-1194</doi><tpages>20</tpages><orcidid>https://orcid.org/0000-0001-9923-1949</orcidid></addata></record> |
| fulltext | fulltext |
| identifier | ISSN: 0025-1747 |
| ispartof | Management decision, 2020-03, Vol.58 (4), p.705-724 |
| issn | 0025-1747 1758-6070 |
| language | eng |
| recordid | cdi_emerald_primary_10_1108_MD-11-2018-1194 |
| source | Emerald Journals |
| subjects | Acquisitions & mergers Competition Competitive advantage Emerging markets Foreign investment Globalization Host country International business Market entry Market positioning Multinational corporations Peers |
| title | Peer effects in outward foreign direct investment: evidence from China |
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