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Arbitrariness of corruption and foreign affiliate performance: A resource dependence perspective

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  • Petrou, Andreas P.

Abstract

Adopting a resource dependence viewpoint, this study investigates how the arbitrariness of corruption in a host country affects subsidiary performance. Analysis of bank foreign affiliates in 37 host countries shows that the negative effect of arbitrariness on affiliate performance is positively moderated by the strength of the sub-unit's corporate link, and the average number of expatriate managers appointed at the sub-unit. This study extends the literature on corruption by exploring a subtle but damaging dimension for foreign entrants and provides cues to managers for the proactive measures to take when they are likely to experience the arbitrariness of corruption.

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  • Petrou, Andreas P., 2015. "Arbitrariness of corruption and foreign affiliate performance: A resource dependence perspective," Journal of World Business, Elsevier, vol. 50(4), pages 826-837.
    • Handle: RePEc:eee:worbus:v:50:y:2015:i:4:p:826-837
    DOI: 10.1016/j.jwb.2015.04.004
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    4. Samuel Kwesi Dunyo & Samuel Amponsah Odei, 2023. "Firm-Level Innovations in an Emerging Economy: Do Perceived Policy Instability and Legal Institutional Conditions Matter?," Sustainability, MDPI, vol. 15(2), pages 1-24, January.
    5. Peter Rodgers & Peter Stokes & Shlomo Tarba & Zaheer Khan, 2019. "The Role of Non-market Strategies in Establishing Legitimacy: The Case of Service MNEs in Emerging Economies," Management International Review, Springer, vol. 59(4), pages 515-540, August.
    6. Bahoo, Salman & Alon, Ilan & Paltrinieri, Andrea, 2020. "Corruption in international business: A review and research agenda," International Business Review, Elsevier, vol. 29(4).
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