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Internationalization and innovation performance of emerging market enterprises: The role of host-country institutional development

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  • Wu, Jie
  • Wang, Chengqi
  • Hong, Junjie
  • Piperopoulos, Panagiotis
  • Zhuo, Shuaihe

Abstract

We examine how host-country institutional development influences innovation performance of internationalized emerging market enterprises (EMEs). Our panel-data analysis of Chinese EMEs shows that although host-country institutional development on average enhances innovation performance of the parent, such effects are more pronounced for EMEs with strong absorptive capacity and for those diversifying into a larger number of countries. Interestingly, EMEs with a higher level of state ownership gain more when entering countries with a lower level of institutional development. Our findings offer insights regarding how latecomer EMEs should configure their portfolio of subsidiaries in order to enhance innovation performance of their parent.

Suggested Citation

  • Wu, Jie & Wang, Chengqi & Hong, Junjie & Piperopoulos, Panagiotis & Zhuo, Shuaihe, 2016. "Internationalization and innovation performance of emerging market enterprises: The role of host-country institutional development," Journal of World Business, Elsevier, vol. 51(2), pages 251-263.
    • Handle: RePEc:eee:worbus:v:51:y:2016:i:2:p:251-263
    DOI: 10.1016/j.jwb.2015.09.002
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