Abstract
| Original language | English |
|---|---|
| Journal | Journal of International Business Studies |
| Volume | 50 |
| Issue number | 1 |
| Pages (from-to) | 111-124 |
| Number of pages | 14 |
| ISSN | 0047-2506 |
| DOIs | |
| Publication status | Published - Feb 2019 |
Bibliographical note
Published online:10 August 2018Keywords
- Corruption
- Dissociation strategy
- Headquarters–subsidiary relations
- Organizational perspective of corruption
- Subsidiary autonomy
Cite this
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Host country corruption and the organization of HQ–subsidiary relationships. / Rabbiosi, Larissa; Santangelo, Grazia D.
In: Journal of International Business Studies, Vol. 50, No. 1, 02.2019, p. 111-124.Research output: Contribution to journal › Journal article › Research › peer-review
TY - JOUR
T1 - Host country corruption and the organization of HQ–subsidiary relationships
AU - Rabbiosi, Larissa
AU - Santangelo, Grazia D.
N1 - Published online:10 August 2018
PY - 2019/2
Y1 - 2019/2
N2 - Multinational enterprises (MNEs) operating in more corrupt host (than home) countries face actual costs related to processing information for decision-making, and lack of local legitimacy, and potential reputation and legal costs in case of corruption scandals. Drawing on the organizational perspective of corruption, we argue that greater subsidiary autonomy helps minimize these costs. However, headquarter (HQ)–subsidiary communication weakens the autonomy-based advantages for minimizing legitimacy costs, and MNEs’ experience in relatively corrupt countries weakens the advantages for minimizing information-processing costs. Our analysis of 261 Italian foreign subsidiaries in 25 host countries confirms most of our arguments except the moderating effect of MNE experience. Our findings contribute to research on corruption and FDI, weak institutional contexts and MNE strategies as well as the literature on HQ–subsidiary relationship.
AB - Multinational enterprises (MNEs) operating in more corrupt host (than home) countries face actual costs related to processing information for decision-making, and lack of local legitimacy, and potential reputation and legal costs in case of corruption scandals. Drawing on the organizational perspective of corruption, we argue that greater subsidiary autonomy helps minimize these costs. However, headquarter (HQ)–subsidiary communication weakens the autonomy-based advantages for minimizing legitimacy costs, and MNEs’ experience in relatively corrupt countries weakens the advantages for minimizing information-processing costs. Our analysis of 261 Italian foreign subsidiaries in 25 host countries confirms most of our arguments except the moderating effect of MNE experience. Our findings contribute to research on corruption and FDI, weak institutional contexts and MNE strategies as well as the literature on HQ–subsidiary relationship.
KW - Corruption
KW - Dissociation strategy
KW - Headquarters–subsidiary relations
KW - Organizational perspective of corruption
KW - Subsidiary autonomy
KW - Corruption
KW - Dissociation strategy
KW - Headquarters–subsidiary relations
KW - Organizational perspective of corruption
KW - Subsidiary autonomy
UR - https://sfx-45cbs.hosted.exlibrisgroup.com/45cbs?url_ver=Z39.88-2004&url_ctx_fmt=info:ofi/fmt:kev:mtx:ctx&ctx_enc=info:ofi/enc:UTF-8&ctx_ver=Z39.88-2004&rfr_id=info:sid/sfxit.com:azlist&sfx.ignore_date_threshold=1&rft.object_id=954921364516&rft.object_portfolio_id=&svc.holdings=yes&svc.fulltext=yes
U2 - 10.1057/s41267-018-0169-1
DO - 10.1057/s41267-018-0169-1
M3 - Journal article
VL - 50
SP - 111
EP - 124
JO - Journal of International Business Studies
JF - Journal of International Business Studies
SN - 0047-2506
IS - 1
ER -