Abstract
| Original language | English |
|---|---|
| Publication date | 2014 |
| Publication status | Published - 2014 |
| Event | 2014 IACMR Conference: Exploring New Concepts and Theories from Chinese Management - The China National Convention Center, Beijing, China Duration: 18 Jun 2014 → 22 Jun 2014 Conference number: 6 http://www.iacmr.org/v2en/Detail.asp?id=313 |
Conference
| Conference | 2014 IACMR Conference: Exploring New Concepts and Theories from Chinese Management |
|---|---|
| Number | 6 |
| Location | The China National Convention Center |
| Country | China |
| City | Beijing |
| Period | 18/06/2014 → 22/06/2014 |
| Internet address |
Bibliographical note
CBS Library does not have access to the materialCite this
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Diversification as a Circumvention Strategy to Institutional Constraints in China : An Official-Entrepreneur Exchange Perspective. / Xie, Peihong; Li, Xin; Wu, Sibin.
2014. Paper presented at 2014 IACMR Conference: Exploring New Concepts and Theories from Chinese Management, Beijing, China.Research output: Contribution to conference › Paper › Research › peer-review
TY - CONF
T1 - Diversification as a Circumvention Strategy to Institutional Constraints in China
T2 - An Official-Entrepreneur Exchange Perspective
AU - Xie, Peihong
AU - Li, Xin
AU - Wu, Sibin
N1 - CBS Library does not have access to the material
PY - 2014
Y1 - 2014
N2 - While unrelated diversification (i.e., conglomeration) is deemed value-destroying in the West, many Chinese private firms have been enthusiastically pursuing such a growth strategy. Conventional institutional view of diversification sees conglomerates as responses to market imperfections in emerging economies and believes conglomeration is value-creating because conglomerates can effectively fill the institutional voids in the emerging markets. Our literature review shows that the conventional institutional view on conglomeration mainly focuses on the value-creating aspects while neglects the socially counterproductive rent-seeking aspects of conglomeration strategy in institution-weak countries (Khanna & Palepu, 2000). In this paper, we fill the gap by examining some unconventional diversifications and point out their rent-seeking nature in China. We have proposed an official-entrepreneur exchange theoretical model to account for such unconventional diversifications. Therefore, we adopt a case study approach to theory-building (Eisenhardt, 1989). We have made two contributions to knowledge. One is that we contribute to the diversification literature by identifying the unconventional diversification phenomenon and proposing a theoretical framework to account for it. The other is that we contribute to the institution-based view of strategy.
AB - While unrelated diversification (i.e., conglomeration) is deemed value-destroying in the West, many Chinese private firms have been enthusiastically pursuing such a growth strategy. Conventional institutional view of diversification sees conglomerates as responses to market imperfections in emerging economies and believes conglomeration is value-creating because conglomerates can effectively fill the institutional voids in the emerging markets. Our literature review shows that the conventional institutional view on conglomeration mainly focuses on the value-creating aspects while neglects the socially counterproductive rent-seeking aspects of conglomeration strategy in institution-weak countries (Khanna & Palepu, 2000). In this paper, we fill the gap by examining some unconventional diversifications and point out their rent-seeking nature in China. We have proposed an official-entrepreneur exchange theoretical model to account for such unconventional diversifications. Therefore, we adopt a case study approach to theory-building (Eisenhardt, 1989). We have made two contributions to knowledge. One is that we contribute to the diversification literature by identifying the unconventional diversification phenomenon and proposing a theoretical framework to account for it. The other is that we contribute to the institution-based view of strategy.
KW - Diversification
KW - Conglomerate
KW - Institution
KW - Rent-seeking
KW - Exchange
M3 - Paper
ER -