It’s all about culture! Institutional context and ownership concentration across Europe

Sacristán-Navarro, María; García, Laura Cabeza; Basco, Rodrigo; Gómez‐Ansón, Silvia

doi:10.1016/j.emj.2021.06.001

Cited by 8 publications

(4 citation statements)

References 81 publications

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“…Recent literature has increasingly acknowledged that institutional distance is a multifaceted construct reflecting the heterogeneity of cross-country variations at multiple levels (e.g. Berry et al, 2010;Perkins, 2014;Kostova et al, 2020;Sacrist an-Navarro et al, 2022). Building on this, we follow prior studies (e.g.…”

Section: Introductionmentioning

confidence: 99%

“…Building on this, we follow prior studies (e.g. Arslan and Larimo, 2011;Rottig et al, 2019;Sacrist an-Navarro et al, 2022;Yang et al, 2022) and unbundle institutional distance into its formal and informal dimensions, the former being captured by the regulatory efficiency, country governance and financial development and the latter regarded in terms of culture.…”

Section: Introductionmentioning

confidence: 99%

“…In particular, this study offers two main contributions. First, we join the ongoing conversations suggesting that patterns of firm internationalization can be explained by the differences between the home and the target country by proposing an integrative framework based on institutional economics that explore the potentially varying effects of both formal and informal dimensions of institutional distance (Berry et al, 2010;Sacrist an-Navarro et al, 2022). Simultaneously, we interpret such effects in terms of how the various formal and informal dimensions of distance affect the liability of foreignness associated with executing acquisitions in emerging versus developed countries, thus building on organizational institutionalism.…”

Section: Introductionmentioning

confidence: 99%

“…First, we join the ongoing conversations suggesting that patterns of firm internationalization can be explained by the differences between the home and the target country by proposing an integrative framework based on institutional economics that explore the potentially varying effects of both formal and informal dimensions of institutional distance (Berry et al. , 2010; Sacristán-Navarro et al. , 2022).…”

Section: Introductionmentioning

confidence: 99%

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Institutional distance and cross-border acquisitions into emerging markets: the moderating effect of context experience

Depperu

Galavotti²,

Baraldi³

2022

IJOEM

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PurposeThis study aims to examine the multidimensional nature of institutional distance as a driver of acquisition decisions in emerging markets. Then, this study aims to offer a nuanced perspective on the role of its various formal and informal dimensions by taking into account the potential contingency role played by a firm’s context experience.Design/methodology/approachBuilding on institutional economics and organizational institutionalism, this study explores the heterogeneity of institutional distance and its effects on the decision to enter emerging versus advanced markets through cross-border acquisitions. Thus, institutional distance is disentangled into its formal and informal dimensions, the former being captured by regulatory efficiency, country governance and financial development. Furthermore, our framework examines the moderating effect of an acquiring firm’s experience in institutionally similar environments, defined as context experience. The hypotheses are analyzed on a sample of 496 cross-border acquisitions by Italian companies in 41 countries from 2008 to 2018.FindingsFindings indicate that at an increasing distance in terms of regulatory efficiency and financial development, acquiring firms are less likely to enter emerging markets, while informal institutional distance is positively associated with such acquisitions. Context experience mitigates the negative effect of formal distance and enhances the positive effect of informal distance.Originality/valueThis study contributes to institutional distance literature in multiple ways. First, by bridging institutional economics and organizational institutionalism and second, by examining the heterogeneity of formal and informal dimensions of distance, this study offers a finer-grained perspective on how institutional distance affects acquisition decisions. Finally, it offers a contingency perspective on the role of context experience.

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Section: Introductionmentioning

confidence: 99%