TY - JOUR
T1 - Escaping from institutional weakness by EM-MNEs
T2 - the role of firms’ resources vulnerability
AU - Losada-Otálora, Mauricio
AU - Andonova, Veneta
N1 - Publisher Copyright:
© 2022, Emerald Publishing Limited.
PY - 2022/6
Y1 - 2022/6
N2 - Purpose: How does emerging market multinational enterprises’ (EM MNEs) resource vulnerability to domestic institutional weakness influence the escapist outward foreign direct investment (OFDI)? This study aims to focus on how varying qualities of technological resources make EM MNEs vulnerable to institutional weakness at home and when such a vulnerability triggers escapist OFDI. Design/methodology/approach: A mix of primary and secondary data is used to study evidence of escapist OFDI in the case of multilatinas. Structural equation modelling and hierarchical regressions were applied to test the hypotheses. Findings: Domestic institutional weakness triggers escapist OFDI only when EM MNEs’ resources are vulnerable to institutional pressures. Technological leadership increases the vulnerability of EM MNEs to the pressure of institutional weaknesses at home, which, in turn, motivates escapist OFDI. Originality/value: In discussing the role of firm resources and their vulnerability to institutional weakness, a mechanism is proposed to shed light on how EM MNEs transform the general country framework of the institutional environment into the specific decision to escape via OFDI.
AB - Purpose: How does emerging market multinational enterprises’ (EM MNEs) resource vulnerability to domestic institutional weakness influence the escapist outward foreign direct investment (OFDI)? This study aims to focus on how varying qualities of technological resources make EM MNEs vulnerable to institutional weakness at home and when such a vulnerability triggers escapist OFDI. Design/methodology/approach: A mix of primary and secondary data is used to study evidence of escapist OFDI in the case of multilatinas. Structural equation modelling and hierarchical regressions were applied to test the hypotheses. Findings: Domestic institutional weakness triggers escapist OFDI only when EM MNEs’ resources are vulnerable to institutional pressures. Technological leadership increases the vulnerability of EM MNEs to the pressure of institutional weaknesses at home, which, in turn, motivates escapist OFDI. Originality/value: In discussing the role of firm resources and their vulnerability to institutional weakness, a mechanism is proposed to shed light on how EM MNEs transform the general country framework of the institutional environment into the specific decision to escape via OFDI.
KW - Emerging multinationals
KW - Escapist OFDI
KW - Firm’s vulnerability
KW - Technological leadership
UR - http://www.scopus.com/inward/record.url?scp=85127274803&partnerID=8YFLogxK
U2 - 10.1108/EBR-07-2021-0147
DO - 10.1108/EBR-07-2021-0147
M3 - Article
AN - SCOPUS:85127274803
SN - 0955-534X
VL - 34
SP - 492
EP - 520
JO - European Business Review
JF - European Business Review
IS - 4
ER -