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International Expansion, Diversification and Regulated Firm Nonmarket Strategy

Author

Listed:
  • Santiago Urbiztondo

    (Fundación de Investigaciones Económicas Latinoamericanas, Buenos Aires - Fundacion)

  • Jean-Philippe Bonardi

    (Department of Marketing, Faculty of Business and Economics - UNIL - Université de Lausanne = University of Lausanne)

  • Bertrand Quélin

    (GREGH - Groupement de Recherche et d'Etudes en Gestion à HEC - HEC Paris - Ecole des Hautes Etudes Commerciales - CNRS - Centre National de la Recherche Scientifique)

Abstract

Previous studies have shown that regulated firms diversify for reasons that are different than for unregulated firms. We explore some of these differences by providing a theoretical model that starts by considering the firm-regulator relationship as an incomplete information issue, in which a regulated incumbent has knowledge that the regulator does not have, but the firm cannot convey hard information about this knowledge. The incumbent faces both market and nonmarket competition from a new entrant. In that context, we show that when the firm faces tough nonmarket competition domestically, going abroad can create a mechanism that makes information transmission to the regulator more credible. International expansion can thus be a way to solve domestic nonmarket issues in addition to being a catalyst for growth

Suggested Citation

  • Santiago Urbiztondo & Jean-Philippe Bonardi & Bertrand Quélin, 2013. "International Expansion, Diversification and Regulated Firm Nonmarket Strategy," Post-Print hal-00852603, HAL.
    • Handle: RePEc:hal:journl:hal-00852603
    DOI: 10.1002/mde.2598
    as

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    References listed on IDEAS

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    Cited by:

    1. Wu Wei & Xuan Zhao & Mei Li & Malcolm Warner, 2016. "Integrating nonmarket and market resources, strategy and performance in Chinese enterprises: a review of the field and a resource-based empirical study," Asia Pacific Business Review, Taylor & Francis Journals, vol. 22(2), pages 220-237, April.
    2. Thomas Wrona & Corinna Sinzig, 2018. "Nonmarket strategy research: systematic literature review and future directions," Journal of Business Economics, Springer, vol. 88(2), pages 253-317, February.

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    More about this item

    Keywords

    International diversification; regulated firms; lobbying; Regulation; nonmarket strategy; international investments; diversification;
    All these keywords.

    JEL classification:

    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business

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