IDEAS home Printed from https://ideas.repec.org/a/pal/jintbs/v38y2007i6p998-1012.html
   My bibliography  Save this article

Network triads: transitivity, referral and venture capital decisions in China and Russia

Author

Listed:
  • Bat Batjargal

    ([1] Harvard University, Cambridge, USA [2] Guanghua School of Management, Peking University, Beijing, P.R. China)

Abstract

This article examines the effects of dyadic ties and interpersonal trust on referrals and investment decisions of venture capitalists in the Chinese and Russian contexts. The study uses the postulate of transitivity of social network theory as a conceptual framework. The findings reveal that referee–venture capitalist tie, referee–entrepreneur tie, and interpersonal trust between referee and venture capitalist have positive effects on referrals and investment decisions of venture capitalists. The institutional, social and cultural differences between China and Russia have minimal effects on referrals. Interpersonal trust has positive effects on investment decisions in Russia. Journal of International Business Studies (2007) 38, 998–1012. doi:10.1057/palgrave.jibs.8400302

Suggested Citation

  • Bat Batjargal, 2007. "Network triads: transitivity, referral and venture capital decisions in China and Russia," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 38(6), pages 998-1012, November.
  • Handle: RePEc:pal:jintbs:v:38:y:2007:i:6:p:998-1012
    as

    Download full text from publisher

    File URL: http://www.palgrave-journals.com/jibs/journal/v38/n6/pdf/8400302a.pdf
    File Function: Link to full text PDF
    Download Restriction: Access to full text is restricted to subscribers.

    File URL: http://www.palgrave-journals.com/jibs/journal/v38/n6/full/8400302a.html
    File Function: Link to full text HTML
    Download Restriction: Access to full text is restricted to subscribers.

    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. Timothy J. Feddersen & Thomas W. Gilligan, 2001. "Saints and Markets: Activists and the Supply of Credence Goods," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 10(1), pages 149-171, March.
    2. Heidrun C. Hoppe & Ulrich Lehmann-Grube, 2001. "Second-Mover Advantages in Dynamic Quality Competition," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 10(3), pages 419-433, September.
    3. Alan M. Rugman & Alain Verbeke, 2004. "A Final Word on Edith Penrose," Journal of Management Studies, Wiley Blackwell, vol. 41(1), pages 205-217, January.
    4. Nathan Fagre & Louis T Wells, 1982. "Bargaining Power of Multinationals and Host Governments," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 13(2), pages 9-24, June.
    5. Abagail McWilliams & Donald S. Siegel & Patrick M. Wright, 2006. "Corporate Social Responsibility: International Perspectives," Rensselaer Working Papers in Economics 0604, Rensselaer Polytechnic Institute, Department of Economics.
    6. Teoh, Siew Hong & Welch, Ivo & Wazzan, C Paul, 1999. "The Effect of Socially Activist Investment Policies on the Financial Markets: Evidence from the South African Boycott," The Journal of Business, University of Chicago Press, vol. 72(1), pages 35-89, January.
    7. David P. Baron, 2001. "Private Politics, Corporate Social Responsibility, and Integrated Strategy," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 10(1), pages 7-45, March.
    8. Abagail McWilliams, 2002. "Raising Rivals' Costs Through Political Strategy: An Extension of Resource-based Theory," Journal of Management Studies, Wiley Blackwell, vol. 39(5), pages 707-724, July.
    9. Marvel, Howard P, 1977. "Factory Regulation: A Reinterpretation of Early English Experience," Journal of Law and Economics, University of Chicago Press, vol. 20(2), pages 379-402, October.
    10. Mohsin Habib & Leon Zurawicki, 2002. "Corruption and Foreign Direct Investment," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 33(2), pages 291-307, June.
    11. Jean J Boddewyn, 1988. "Political Aspects of MNE Theory," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 19(3), pages 341-363, September.
    12. Treisman, Daniel, 2000. "The causes of corruption: a cross-national study," Journal of Public Economics, Elsevier, pages 399-457.
    13. Judith F. Posnikoff, 1997. "Disinvestment From South Africa: They Did Well By Doing Good," Contemporary Economic Policy, Western Economic Association International, vol. 15(1), pages 76-86, January.
    14. Donald S. Siegel & Donald F. Vitaliano, 2007. "An Empirical Analysis of the Strategic Use of Corporate Social Responsibility," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 16(3), pages 773-792, September.
    15. Beata K. Smarzynska & Shang-Jin Wei, 2000. "Corruption and Composition of Foreign Direct Investment: Firm-Level Evidence," NBER Working Papers 7969, National Bureau of Economic Research, Inc.
    16. Shang-Jin Wei, 1997. "Why is Corruption So Much More Taxing Than Tax? Arbitrariness Kills," NBER Working Papers 6255, National Bureau of Economic Research, Inc.
    17. Catherine J. Morrison-Paul & Donald S. Siegel, 2006. "Corporate Social Responsibility and Economic Performance," Rensselaer Working Papers in Economics 0605, Rensselaer Polytechnic Institute, Department of Economics.
    18. Mark Bagnoli & Susan G. Watts, 2003. "Selling to Socially Responsible Consumers: Competition and The Private Provision of Public Goods," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 12(3), pages 419-445, September.
    19. Catherine M. Paul & Donald Siegel, 2006. "Corporate social responsibility and economic performance," Journal of Productivity Analysis, Springer, vol. 26(3), pages 207-211, December.
    20. Indjikian, Rouben & Siegel, Donald S., 2005. "The Impact of Investment in IT on Economic Performance: Implications for Developing Countries," World Development, Elsevier, pages 681-700.
    21. Paolo Mauro, 1995. "Corruption and Growth," The Quarterly Journal of Economics, Oxford University Press, vol. 110(3), pages 681-712.
    22. Eden, Lorraine & Molot, Maureen Appel, 2002. "Insiders, outsiders and host country bargains," Journal of International Management, Elsevier, vol. 8(4), pages 359-388.
    23. Timothy P Blumentritt & Douglas Nigh, 2002. "The Integration of Subsidiary Political Activities in Multinational Corporations," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 33(1), pages 57-77, March.
    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. Olivier Blanchard & Michael Kremer, 1997. "Disorganization," The Quarterly Journal of Economics, Oxford University Press, vol. 112(4), pages 1091-1126.
    2. Yeniyurt, Sengun & Carnovale, Steven, 2017. "Global supply network embeddedness and power: An analysis of international joint venture formations," International Business Review, Elsevier, pages 203-213.
    3. Daria Volchek & Ari Jantunen & Sami Saarenketo, 2013. "The institutional environment for international entrepreneurship in Russia: Reflections on growth decisions and performance in SMEs," Journal of International Entrepreneurship, Springer, vol. 11(4), pages 320-350, December.
    4. Sheila Puffer & Daniel McCarthy & Alfred Jaeger & Denise Dunlap, 2013. "The use of favors by emerging market managers: Facilitator or inhibitor of international expansion?," Asia Pacific Journal of Management, Springer, pages 327-349.
    5. Hom, Peter W. & Xiao, Zhixing, 2011. "Embedding social networks: How guanxi ties reinforce Chinese employees’ retention," Organizational Behavior and Human Decision Processes, Elsevier, vol. 116(2), pages 188-202.
    6. Daniel McCarthy & Sheila Puffer & Denise Dunlap & Alfred Jaeger, 2012. "A Stakeholder Approach to the Ethicality of BRIC-firm Managers’ Use of Favors," Journal of Business Ethics, Springer, pages 27-38.
    7. Bat Batjargal, 2012. "The Effects Of Network???S Structural Holes: Polycentric Institutions, Product Portfolio, And New Venture Growth In China And Russia," William Davidson Institute Working Papers Series wp1033, William Davidson Institute at the University of Michigan.
    8. Michael A. Hitt & Tiago Ratinho, 2011. "The Multifaceted Effects of Institutions on Firm Strategies and Entrepreneurial Actions," Chapters,in: The Nature of the New Firm, chapter 4 Edward Elgar Publishing.
    9. Li, Dan & Miller, Stewart R. & Eden, Lorraine & Hitt, Michael A., 2012. "The Impact of Rule of Law on Market Value Creation for Local Alliance Partners in BRIC Countries," Journal of International Management, Elsevier, vol. 18(4), pages 305-321.
    10. Boris Bauke & Thorsten Semrau & Zheng Han, 2016. "Relational trust and new ventures’ performance: the moderating impact of national-level institutional weakness," International Entrepreneurship and Management Journal, Springer, vol. 12(4), pages 1007-1024, December.
    11. Dmitry Khanin & Kristie Ogilvie & David Leibsohn, 2012. "International entrepreneurship, venture capital networks, and reinvestment decisions," Journal of International Entrepreneurship, Springer, vol. 10(1), pages 1-24, March.
    12. Wafa N. Almobaireek & Ahmed A. Alshumaimeri & Tatiana S. Manolova, 2016. "Building entrepreneurial inter-firm networks in an emerging economy: the role of cognitive legitimacy," International Entrepreneurship and Management Journal, Springer, vol. 12(1), pages 87-114, March.
    13. Gao, Lan & Liu, Xiaohui & Zou, Huan, 2013. "The role of human mobility in promoting Chinese outward FDI: A neglected factor?," International Business Review, Elsevier, pages 437-449.
    14. Michael Rochlitz, 2016. "Collective Action Abroad: How Foreign Investors Organize Evidence from Foreign Business Associations In the Russian Federation," HSE Working papers WP BRP 32/PS/2016, National Research University Higher School of Economics.
    15. Bat Batjargal, 2013. "Institutional Polycentrism, Entrepreneurs??? Social Networks, And New Venture Growth," William Davidson Institute Working Papers Series wp1060, William Davidson Institute at the University of Michigan.
    16. Kiss, Andreea N. & Danis, Wade M. & Cavusgil, S. Tamer, 2012. "International entrepreneurship research in emerging economies: A critical review and research agenda," Journal of Business Venturing, Elsevier, vol. 27(2), pages 266-290.
    17. Zhang, Jing & Pezeshkan, Amir, 2016. "Host country network, industry experience, and international alliance formation: Evidence from the venture capital industry," Journal of World Business, Elsevier, vol. 51(2), pages 264-277.

    More about this item

    Statistics

    Access and download statistics

    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:pal:jintbs:v:38:y:2007:i:6:p:998-1012. 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: (Sonal Shukla) or (Rebekah McClure). General contact details of provider: http://www.palgrave-journals.com/ .

    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.

    We have no references for this item. You can help adding them by using 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.