Why Did They Get in Trouble? The Influence of Firm Characteristics and Institutional Distance in the Case of Chinese Outward Foreign Direct Investment

Posted: 24 Jun 2020

See all articles by Abdelkader Derbali

Abdelkader Derbali

Community College, Taibah University; Higher Institute of Informatics and Management of Kairouan, Kairouan University, Tunisia

Date Written: January 29, 2020

Abstract

Existing research on Chinese multinational companies has overlooked the fact that China’s outward foreign direct investment is facing a high failure rate even in their initial attempt to enter a foreign market. Grounded on institutional theory, this study provides a more holistic view of the globalization dynamic using a unique dataset that contains both successful and failed Chinese outward foreign direct investment attempts during the year 2017 to 2018. Firm characteristics have an important influence on the probability of successful foreign market entry attempt, but the effect is conditioned on institutional discrepancies between China and host countries.

Keywords: Chinese OFDI, Market Entry Attempt, Firm Characteristics, Institutional Distance

JEL Classification: O24, G23, F23

Suggested Citation

Derbali, Abdelkader, Why Did They Get in Trouble? The Influence of Firm Characteristics and Institutional Distance in the Case of Chinese Outward Foreign Direct Investment (January 29, 2020). Available at SSRN: https://ssrn.com/abstract=3615046

Abdelkader Derbali (Contact Author)

Community College, Taibah University ( email )

Community College, Taibah University
Medinah
Saudi Arabia

Higher Institute of Informatics and Management of Kairouan, Kairouan University, Tunisia ( email )

Kairouan
Tunisia

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