Escaping from institutional weakness by EM MNEs: the role of firms-vulnerability

We incorporate in the current dialogue of institutions and escapist OFDI the moderator role of the vulnerability of EM MNEs to institutional weakness at home. Using primary and secondary data from multilatinas we found that the vulnerability of the firms' technological resources to the institutional weakness is a contingent factor that explains escapist OFDI for EM MNEs that are technological leaders in home countries with weak institutions. Our findings suggest that while EM MNEs seek technological leadership, they must be prepared to invest abroad to protect their sources of advantages and learn to integrate operations geographically and institutionally distant.