IDEAS home Printed from https://ideas.repec.org/a/eee/riibaf/v35y2015icp88-103.html
   My bibliography  Save this article

Entry mode and emerging market MNEs: An analysis of Chinese greenfield and acquisition FDI in the United States

Author

Listed:
  • Anderson, John
  • Sutherland, Dylan

Abstract

A growing theoretical literature on emerging market MNEs argues they use aggressive acquisitions, often to psychically distant, developed host countries, to obtain strategic assets. The use of acquisitions as the dominant entry mode for strategic asset seeking, therefore, stands at heart of current EM MNE theorizing. To date, however, systematic empirical testing of the motivations for different entry modes by EM MNEs is limited. We address this gap by exploring the motivations for Chinese greenfield and acquisition investments in the United States. Our results are broadly supportive of the growing theoretical literature on EM MNEs, arguing acquisitions are the primary mode of strategic asset seeking in developed markets. We also find state ownership impacts strategic assets seeking and strategic asset seeking intensified in the post global financial crisis period.

Suggested Citation

  • Anderson, John & Sutherland, Dylan, 2015. "Entry mode and emerging market MNEs: An analysis of Chinese greenfield and acquisition FDI in the United States," Research in International Business and Finance, Elsevier, vol. 35(C), pages 88-103.
  • Handle: RePEc:eee:riibaf:v:35:y:2015:i:c:p:88-103
    DOI: 10.1016/j.ribaf.2015.03.008
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0275531915000331
    Download Restriction: Full text for ScienceDirect subscribers only

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Keupp, Marcus M. & Gassmann, Oliver, 2009. "International innovation and strategic initiatives: A research agenda," Research in International Business and Finance, Elsevier, vol. 23(2), pages 193-205, June.
    2. Luo, Yadong & Xue, Qiuzhi & Han, Binjie, 2010. "How emerging market governments promote outward FDI: Experience from China," Journal of World Business, Elsevier, vol. 45(1), pages 68-79, January.
    3. Brennan, L. & Garvey, D., 2009. "The role of knowledge in internationalization," Research in International Business and Finance, Elsevier, vol. 23(2), pages 120-133, June.
    4. Peter Nolan, 2012. "Is China Buying the World?," Challenge, Taylor & Francis Journals, vol. 55(2), pages 108-118.
    5. Kling, Gerhard & Weitzel, Utz, 2011. "The internationalization of Chinese companies: Firm characteristics, industry effects and corporate governance," Research in International Business and Finance, Elsevier, vol. 25(3), pages 357-372, September.
    6. Slangen, Arjen & Hennart, Jean-François, 2007. "Greenfield or acquisition entry: A review of the empirical foreign establishment mode literature," Journal of International Management, Elsevier, vol. 13(4), pages 403-429, December.
    7. Hennart, J.M.A., 2012. "Emerging market multinationals and the theory of the multinational enterprise," Other publications TiSEM 23818daa-f6ed-4fd6-bca4-3, Tilburg University, School of Economics and Management.
    8. Hong, Paul & Roh, James, 2009. "Internationalization, product development and performance outcomes: A comparative study of 10 countries," Research in International Business and Finance, Elsevier, vol. 23(2), pages 169-180, June.
    9. John Mathews, 2006. "Dragon multinationals: New players in 21 st century globalization," Asia Pacific Journal of Management, Springer, vol. 23(1), pages 5-27, March.
    10. Child, John & Rodrigues, Suzana B., 2005. "The Internationalization of Chinese Firms: A Case for Theoretical Extension?," Management and Organization Review, Cambridge University Press, vol. 1(03), pages 381-410, November.
    11. Yadong Luo & Rosalie L Tung, 2007. "International expansion of emerging market enterprises: A springboard perspective," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 38(4), pages 481-498, July.
    12. Brennan, Louis, 2009. "Innovation and internationalisation," Research in International Business and Finance, Elsevier, vol. 23(2), pages 117-119, June.
    13. Anderson, John & Sutherland, Dylan & Severe, Sean, 2015. "An event study of home and host country patent generation in Chinese MNEs undertaking strategic asset acquisitions in developed markets," International Business Review, Elsevier, vol. 24(5), pages 758-771.
    14. Jean-François Hennart & Young-Ryeol Park, 1993. "Greenfield vs. Acquisition: The Strategy of Japanese Investors in the United States," Management Science, INFORMS, vol. 39(9), pages 1054-1070, September.
    15. Chengqi Wang & Junjie Hong & Mario Kafouros & Mike Wright, 2012. "Exploring the role of government involvement in outward FDI from emerging economies," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 43(7), pages 655-676, September.
    16. Vecchi, Alessandra & Brennan, Louis, 2009. "A cultural perspective on innovation in international manufacturing," Research in International Business and Finance, Elsevier, vol. 23(2), pages 181-192, June.
    17. Rios-Morales, Ruth & Brennan, Louis, 2009. "Ireland's innovative governmental policies promoting internationalisation," Research in International Business and Finance, Elsevier, vol. 23(2), pages 157-168, June.
    18. John Child & Suzana B. Rodrigues, 2005. "The Internationalization of Chinese Firms: A Case for Theoretical Extension?," Management and Organization Review, International Association of Chinese Management Research, vol. 1(3), pages 381-410, November.
    19. Lin Cui & Fuming Jiang, 2012. "State ownership effect on firms' FDI ownership decisions under institutional pressure: a study of Chinese outward-investing firms," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 43(3), pages 264-284, April.
    20. Peter J Buckley & L Jeremy Clegg & Adam R Cross & Xin Liu & Hinrich Voss & Ping Zheng, 2007. "The determinants of Chinese outward foreign direct investment," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 38(4), pages 499-518, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Xie, En & Reddy, K.S. & Liang, Jie, 2017. "Country-specific determinants of cross-border mergers and acquisitions: A comprehensive review and future research directions," Journal of World Business, Elsevier, vol. 52(2), pages 127-183.
    2. Sun, Zhe & Vinig, Tsvi & Hosman, Thomas Daniël, 2017. "The financing of Chinese outbound mergers and acquisitions: Is there a distortion between state-owned enterprises and privately owned enterprises?," Research in International Business and Finance, Elsevier, vol. 39(PA), pages 377-388.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:riibaf:v:35:y:2015:i:c:p:88-103. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dana Niculescu). General contact details of provider: http://www.elsevier.com/locate/ribaf .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.