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Understanding the uniqueness of emerging markets and their firms: institutional voids-based dynamic capabilities in the Chinese automotive sector

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  • Cote, Christine
  • Hu, Helen

Abstract

IB scholars are interested in understanding the uniqueness of emerging markets and their firms and argue that firms operating in environments characterized by institutional voids are likely to face higher costs due to reduced information flows and limited market intermediaries. We argue that institutional voids drive the dynamic capabilities of emerging market multinational enterprises. Taking the Chinese auto industry as an example, this article integrates institutional voids and dynamic capabilities to provide insight into how Chinese EMNEs have moved from technology followers to technology leaders to integrate, build, and reconfigure internal and external competencies and address a rapidly changing environment.

Suggested Citation

  • Cote, Christine & Hu, Helen, 2025. "Understanding the uniqueness of emerging markets and their firms: institutional voids-based dynamic capabilities in the Chinese automotive sector," LSE Research Online Documents on Economics 127244, London School of Economics and Political Science, LSE Library.
  • Handle: RePEc:ehl:lserod:127244
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    File URL: http://eprints.lse.ac.uk/127244/
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    References listed on IDEAS

    as
    1. North,Douglass C., 1991. "Institutions, Institutional Change and Economic Performance," Cambridge Books, Cambridge University Press, number 9780521394161, June.
    2. Jonathan Doh & Suzana Rodrigues & Ayse Saka-Helmhout & Mona Makhija, 2017. "International business responses to institutional voids," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 48(3), pages 293-307, April.
    3. Alvaro Cuervo-Cazurra & Mehmet Genc, 2008. "Transforming disadvantages into advantages: developing-country MNEs in the least developed countries," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 39(6), pages 957-979, September.
    4. Teece, David J, 2018. "Dynamic capabilities as (workable) management systems theory," Journal of Management & Organization, Cambridge University Press, vol. 24(3), pages 359-368, May.
    5. Dieleman, Marleen & Markus, Stanislav & Rajwani, Tazeeb & White, George O., 2022. "Revisiting Institutional Voids: Advancing the International Business Literature by Leveraging Social Sciences," Journal of International Management, Elsevier, vol. 28(3).
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    emerging markets; EMMNEs; dynamic capability; institutional voids; China Speed;
    All these keywords.

    JEL classification:

    • J50 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - General

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    This paper has been announced in the following NEP Reports:

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