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Home-country government support, interstate relations and the subsidiary performance of emerging market multinational enterprises

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  • Han, Xia
  • Liu, Xiaohui
  • Xia, Tianjiao
  • Gao, Lan

Abstract

Drawing on the institution-based view and the global political economy perspective, this study examines the role of home-country government support and interstate relations in the overseas subsidiary performance of Chinese multinational enterprises (MNEs). We focus on two aspects of home-country government support: financial support and non-financial policy support, as well as their effects under the contingency of interstate relations. Using survey data, we find that Chinese MNEs' subsidiary performance is positively related to the degree of home-country government non-financial policy support, but not financial support. The impact of non-financial policy support is contingent on interstate political and economic relations. Stronger interstate political relations complement the impact of non-financial policy support on subsidiary performance, whereas interstate economic relations have a substitutive effect.

Suggested Citation

  • Han, Xia & Liu, Xiaohui & Xia, Tianjiao & Gao, Lan, 2018. "Home-country government support, interstate relations and the subsidiary performance of emerging market multinational enterprises," Journal of Business Research, Elsevier, vol. 93(C), pages 160-172.
    • Handle: RePEc:eee:jbrese:v:93:y:2018:i:c:p:160-172
    DOI: 10.1016/j.jbusres.2018.04.021
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